OTT to Account for Quarter of LatAm Video Consumption in 2025

PLANO: The over-the-top (OTT) video market in Latin America is poised for rapid growth, according to new research from The Diffusion Group (TDG), which predicts that 25 percent of all videos viewed in LatAm in 2025 will be via OTT services.

“Latin America is an important global market by virtue of its size, growth and cultural relevance–and, of course, its crossover with an increasingly Hispanic U.S. market,” said Joel Espelien, TDG senior analyst and author of the new report El Futuro de TV – OTT Video in Latin America 2015-2025. “This developing opportunity was not lost on Netflix, which first entered the market in 2011 and is now available in 43 countries across the region.”

As of April, Netflix had more than 5 million subscribers in Latin America, less than originally expected. However, recent growth has spurred Netflix to invest heavily in original Spanish-language content specifically designed for this market. “The fact that Netflix is expanding its efforts in the region should send a strong message to others that the time for entry is now,” Espelien said.

As for the driving force behind the sizable base of technology-savvy, internet-connected consumers now encountering OTT video in LatAm, TDG points to shifts such as a growing young population; a common Spanish- and Portuguese-language media market; and the emergence of an educated, urbanized middle class.

TDG also notes that OTT video in Latin America does have challenges to face, including poor penetration of fixed broadband, widespread poverty and the dominance of legacy free-to-air broadcasters. Despite these challenges, TDG forecasts that OTT video will experience strong growth in Latin America over the next decade. By 2025, Latin American OTT video viewers will collectively consume 25 percent of all video viewed, generating $8 billion in annual revenue.