Subscription OTT Revenue to Surpass Cinema in 2019

According to Ampere Analysis, global subscription OTT revenues are set to reach $46 billion next year, overtaking box-office revenues, which are forecast at $40 billion.

The slowdown in theatrical in North America and Western Europe is the primary driver of this trend, as SVOD continues to grow in all regions. In the U.S., subscription OTT revenues overtook theatrical revenues in 2017. The U.K. is expected to follow suit by the end of 2018. In China, it will happen in 2019.

In 9 out of 15 markets in Ampere’s asssessment—Australia, France, Germany, Japan, the Netherlands, Sweden, Turkey, the U.S. and the U.K.—the average price of a cinema ticket is higher than one month’s subscription to an SVOD service. The two markets with the lowest cinema attendance are Japan, where theater tickets are almost double average SVOD price, and Germany, where it is around 50 percent higher.

In all the markets surveyed, SVOD subscribers are more avid cinema-goers than non-SVOD subscribers. In Japan, SVOD subscribers visit the cinema more than three times as often as their counterparts.

Toby Holleran, senior analyst at Ampere Analysis, said: “Our analysis of consumers in 15 markets reveals that although there are differences in the cost of cinema attendance by country, there’s clearly an appetite for content amongst some consumers whether that be on the big screen, or a smaller one. The key for cinema is to understand that while SVOD subscribers are more avid cinema-goers, this may not always be the case. Therefore, the shared experience of watching a film on the big screen must remain an enticing—and realistically priced—one.”