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Evolution of Video Entertainment in Emerging Markets

The impact of alternative forms of video entertainment on the traditional pay-TV sector is now very much a global phenomena. What started as a small disruption in North America, with the introduction of Netflix and Hulu service offerings, has evolved into a transformation that reaches far and wide.

Over-the-Top (OTT) television and video revenues within the Eastern Europe, Middle East and Africa (EEMEA) region, which includes nineteen countries, will reach $2.63 billion in 2020 -- that's up from only $52 million recorded in 2010, and the $616 million expected in 2015.

According to the latest market study by Digital TV Research, from the $2.21 billion in revenues to be added between 2014 and 2020, Russia is forecast to contribute $795 million, with Turkey bringing in a further $219 million.

Russia will remain the largest revenue earner in the region, by a wide margin.

"OTT in Eastern Europe, Middle East & Africa will still be an immature sector by 2020, although this is an improvement on the very immature status by end-2014 and its nearly nonexistent status in 2010," said Simon Murray, principal analyst at Digital TV Research.


Subscription video on demand (SVOD) services, such as Netflix, will become the region's largest OTT revenue source in 2017.

SVOD revenues will total $1.56 billion by 2020 -- that's 60 percent of total OTT revenues, up from only $3 million in 2010 -- which was 6 percent of total OTT revenues.

Digital TV Research forecasts that there will be 24.22 million SVOD homes in the region by 2020 -- that's up from 69,000 in 2010 and an expected 3.13 million by the end of 2015.

Moreover, according to the analyst's latest assessment, Russia will overtake Poland to become the largest SVOD country in 2015.

From the 22.71 million SVOD home additions between 2014 and 2020, Russia will supply 8.97 million, Turkey 2.37 million and Poland 2.07 million.

By 2020, 12.3 percent of the region's TV households will subscribe to a SVOD package -- that's up from only 0.8 percent by the end of 2014. That being said, market penetration rates will vary considerably -- now estimated from 30 percent in Israel, to just 1.5 percent in Egypt.

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