SVOD to Overtake Advertising as Top OTT Revenue Source

LONDON: Global OTT TV and video revenues will reach $51.1 billion in 2020, a new report from Digital TV Research projects, with subscriptions overtaking advertising as the segment's largest revenue contributor.

In 2010, global OTT revenues were just $4.2 billion, rising to an expected $26 billion in 2015. In 2020, of the $51.1 billion total revenues, $21.6 billion will come from subscriptions and $20.98 billion from advertising, followed in distant third by $5.6 billion in download-to-own revenues and just $2.8 billion from rentals and pay per view.

The U.S. will remain the largest OTT market for the foreseeable future, contributing revenues of $19.1 billion in 2020 with 70 million SVOD homes. In total there will be 249 million SVOD homes in 2020, up from the 117 million forecast for this year.

“SVOD has developed even faster than we expected in our last edition a year ago," said Simon Murray, principal analyst at Digital TV Research. "Some of this growth was spurred by Netflix’s aim to establish operations in 200 countries by end-2016. Not only has the launch of Netflix boosted each market, but the anticipation of its launch has galvanized local players into action—creating a whirlwind of promotional activity.”