Analyst: U.S. OTT Boom Years Are Over

The boom years for U.S. OTT are over, as subscription video-on-demand (SVOD) and other segments reach maturity and streaming operators pull back on content spend, according to a new forecast of North American OTT TV and video by Digital TV Research.

Between 2023 and 2029, SVOD revenues are projected to grow by just $2.1 billion, or 4%, from $52.5 billion to $54.6 billion.

U.S. OTT TV episode and movie revenues are forecast to rise by $8 billion, or 10.8%, from $74 billion to $82 billion.

Advertising-supported video-on-demand (AVOD) for TV series and movies are projected to increase by $6 billion, 38.5%, from $15.6 billion to $21.6 billion.

Advertising on linear channels on free, ad-supported streaming services (FASTs) are projected to see the greatest growth, accounting for $6.5 billion of the AVOD total in 2029 — up by $2.2 billion, from $4.3 billion, in 2023, or 51.6%.

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Paying to download titles, or download-to-own (DTO), is forecast to be flat, at about $3 billion, during the period.  

And title rental revenues are forecast to drop from $2.6 billion to $0.7 billion.

“These forecasts reflect the new reality,” says Simon Murray, principal analyst at Digital TV Research. “Subscriptions are stuttering as the market matures and consolidates. Advertising growth will be lower than our previous forecasts due to tougher market conditions and greater caution from the platforms. Platforms are more wary about increasing content spend, which will stifle subscriber development.”

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