Omdia: Covid-19 to see 50% increase in digital consumption, 12% growth in streaming | Media Analysis | Business | News | Rapid TV News
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The broadcast industry like all others is bracing for a new normal in the wake of the Coronavirus outbreak, and in attempting to plot a potential roadmap for the sector, industry analyst Omdia is predicting that while significant disruption is virtually certain, the anticipated impact of Covid-19 on digital consumer services may not be universally negative.
netflix 18 july 2019
The analyst has produced a snapshot of what may likely take place in the broadcast and video industry what is a hugely fast moving situation and which has already led to the leading streaming firms, first Netflix and subsequently Amazon Prime and YouTube, to offer content in standard resolution on order to ease the added strain on home networks across Europe.

Overall, said Maria Rua Aguete, technology fellow and executive director, media, service providers, and platforms at the tech research firm, there will likely be up to 50% increase in digital content consumption and 12% growth of the online streaming industry as a result of the Covid-19 outbreak.

“Increased consumption of digital content from mobile apps to free TV streaming and gaming has already been observed in China and Italy and can go up to 50% in traffic increase,” she remarked. “Online streaming services provided by brands such as Netflix and now Disney+ which is launching in the UK this week are likely to see 12% growth this year, adding $6 billion more in cumulative revenues, although sport streaming services may suffer as a result of cancellations in live sports events. Ecommerce will be the other sector that will see a revenue boost as a result of the pandemic, adding $175 billion in revenue in 2020, which represents a 5% increase.”

However, while she sees the increases in the digital and streaming sectors, the analyst warned that there would be a commensurate 15% fall in TV advertising by the end of the year and the film industries and cinema in particular seeing as much as a 25% decline in revenues, resulting in $11 billion losses.

“But while free TV streaming and online content streaming services (OTT) will experience growth, paid TV will see a decline which will be accompanied by a 15% drop in TV advertising as brands cut discretionary ad spend due to economic woes, especially where product supply is unable to fulfil demand,” Rua Aguete added.

“This will also impact sponsorship of live events such as festivals and sports events. Segments that rely on live entertainment such as eSport, music and cinema will suffer greatly from ticket sales loss. Cinema is definitely one of the sectors most severely affected by the virus. Due to the lockdown many cinemas around the world are now closed and this will result in a 25% decline in revenues in 2020 representing $11 billion in losses for the movies industry.”

Going forward, and noting the deeper and more important outcome of the Covid-19 outbreak as the effect it will have on the economy,  Omdia expects that it will take 18 to 24 months before recovery can commence.