Commentary

Streaming VOD Ousts Pay-TV

According to research from Ooyala, 2017 was a pivotal year in the media landscape, as U.S. pay-TV operators lost subscribers. Migration of subscribers is a global one, says the report, and analysts posit that it won’t end anytime soon. Subscribers to premium SVOD (Streaming/Subscription Video On Demand) services are forecast to top 778 million by 2022, with global SVOD revenues topping $84 billion, compared to $35 billion last year.

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In Europe, the SVOD market is expected to reach 60.8 million subscribers from the current 39.3 million. Revenues are forecast to hit $6.8 billion, up from $3.9 billion last year.  SNL Kagan says the biggest drivers for SVOD growth in Europe will be Netflix and Amazon creating new, local content for the market, along with other international services with HBO and Showtime entering the market with their own original content. 

North America’s market is expected to see strong growth, despite already having more than 112 million subscribers, says the report. Digital TV Research expects the sector to add another 59 million subscribers by 2022. In a report from Sensor Tower, revenue for the top 10 SVOD apps (Netflix, YouTube, HBO NOW, Hulu, Starz, MLB.com At Bat, Showtime, Crunchyroll, CBS and UFC) grew 77% in 2017, to reach $781 million across the App Store and Google Play. Netflix was the world’s highest-earning non-game app in 2017 at more than $290 million, up 113% Y/Y. CBS All Access revenue was up 128%, YouTube was up 154%, and Starz 147%.

Another 58 million+ to the 2021 subscriber pot in Asia-Pacific, up from about 100 million today (from just 41.7 million in 2015), according to Digital TV Research (17.5% of the region’s households.) 

Finally, research firm Analysys Mason expects revenue in Latin America to be dominated by SVOD services generally, and Netflix in particular, and predicts the number of SVOD subscribers will grow to 55 million by 2022, more than double the current 20 million. 

1 comment about "Streaming VOD Ousts Pay-TV".
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  1. Ed Papazian from Media Dynamics Inc, April 9, 2018 at 7:35 a.m.

    In the U.S. we estimate SVOD penetration at about 72% while "pay TV" stands at roughly 80-81%. Moreover if you add homes that get only over-the-air TV "Linear TV's penetration is 95%. More important, in terms af total viewing time, SVOD accounts for roughly 15-16% while "linear TV" gets 84-85%. So it's a leap to say that SVOD has "ousted"  TV ---which is the implication ---especially when the term "pay TV" is utilized.

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