Advertising expenditures attributed to TV episodes and movies will rise 144% between 2020 and 2026 to reach $66 billion across 138 countries, according to the latest projections from Digital TV Research.
AVOD growth dipped to “only” 9.2% in 2020 due to cutbacks in spending during the COVID-19 pandemic -- but more robust growth will resume starting this year, the Global AVOD Forecasts report says.
The U.S. will contribute $21 billion of the $39 billion in incremental revenues generated between 2020 and 2026, and China will contribute $5 billion.
The U.S.’s AVOD revenues will triple during the period to $31 billion. Rather than losing market share as other countries catch up, the U.S. will grow its share of the global total from 37% in 2020 to 47% by 2026.
The U.S. became the world’s largest AVOD country in 2019, as China saw expenditure fall by 9% due to its economic downturn.
A combination of the Coronavirus pandemic lockdown and a continued economic downturn caused China’s AVOD revenue to decline by another 14% in 2020.
China will not better its 2018 total until 2024, although its growth will begin to return this year.
The U.S. has both the most developed OTT sector in the world and the most developed advertising market — which means that successful AVOD platform launches in the U.S. “will not necessarily thrive elsewhere,” cautions the research firm.