Gains Seen in Movie-on-Demand Revenues in Europe, U.S.

LONDON: By 2013, movie-on-demand revenues for pay-TV operators will reach $2.4 billion in the U.S. and 430 million euros in Western Europe, Futuresource Consulting indicates in a new report.

“The rise of on-demand video content that can be accessed through a laptop, PC or mobile phone shows no signs of stopping,” said Carl Hibbert, business consultant at Futuresource. “And with so much competition out there, the consumer is in the driving seat, demanding entertainment be delivered on their terms, whenever, wherever and however they please. But the pay-TV industry is fighting back, and looking to VOD to supplement its linear TV offering. As well as improving their consumer proposition, reducing customer churn and recalibrating their brand positioning, operators are using VOD as a tool for driving up the average revenue per user. Paid-for VOD is a small part of the market, but it is expanding, and that’s despite the glut of readily-available free and ‘catch up’ VOD. Growth opportunities are coming from the continued conversion of analogue to digital cable, the expansion of IPTV, and the introduction of hybrid services by satellite operators. As movie release windows shorten and VOD releases come on stream ‘day and date’ with DVD and Blu-ray we’re going to see more traction, but a number of studios are holding back, believing this may cannibalize their packaged media revenues.”

A key driver for boosting VOD revenues is improved EPGs that make searching and purchasing easier, and that can allow for personalization by the the subscriber. According to Futuresource, the next stage will the introduction of lifestyle-orientated TV homepages that will help customers better sort through the wealth of programming available live and on demand.