Coronavirus: global video-on-demand subs set for 5% added growth in 2020 | VOD | News | Rapid TV News
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With so many people across the world working and learning at home, and the growing number of consumers adopting social distancing or forced into quarantine, the subscription video-on-demand (SVOD) market could see short-term subscriber growth says research from Strategy Analytics.
Disney 24Mar2020 2
In its latest roundup of the prospects for SVOD services such as Netflix, Global SVOD Forecast by Service (2010 - 2025), the analyst assessed the expected impact of the Covid-19 pandemic and concluded that although the longer term impact clearly remains uncertain, early evidence suggests that a boost to SVOD usage globally can be expected. It added that mid-to-long term impact depends on length of the pandemic and resulting economic damage.

Putting a number on the assumed outcomes, Strategy Analytics calculated in global subscriptions would increase by 5% in comparison to the pre-pandemic model. This would mean 949 million paid subscriptions globally by the end of 2020, suggesting an increase of 47 million compared with earlier forecasts. Longer term, the forecast predicts that paid SVOD subscriptions will grow by 621 million between 2019 and 2025, reaching 1.43 billion.

Looking at regions, currently China and the US combined account for nearly two-thirds (65%) of paid global SVOD subscriptions. However, the analyst predicted that as these markets mature and approach market saturation and paid subscriptions, particularly in Southeast Asia grow, their share of global SVOD subscriptions will fall to 55% in 2025.

Yet despite its declining global share, China is set to remain the largest SVOD market with 438 million paid subscriptions in 2025, up from 131 million from 2019. The US will likely follow with 342 million subscriptions in 2025, up from 125 million from 2019. With nearly three-quarters of US TV households subscribing to one or more SVOD service the US SVOD market is becoming saturated, the analyst warned. That said, the company recognised that with US SVOD households continuing to add additional services such as CBS All Access, the hugely globally popular Disney+, and the soon-to-launch HBO MAX the total number of SVOD subscriptions in the US will likely continue to grow.

“One significant factor affecting future SVOD growth is the impact of the Coronavirus in both the short and long term,” said Michael Goodman, director, TV and media strategies commenting on the Global SVOD Forecast by Service (2010 - 2025) report.

“In the near term the Coronavirus will actually boost SVOD subscriptions, as well as viewing of these services, as an ever growing number of consumers adopt social distancing or are forced into quarantine. In the mid-to-long term much depends on the length of the pandemic and resulting economic damage. As businesses shut down and individuals are laid off consumers are going to have to make hard decisions about how they spend their money and as wonderful as Netflix, Amazon Prime Video, Disney+ and other SVOD services may be, they are not essential services.”