Skip to main content

SVOD Revenue Forecast to Reach $34.6 Billion by 2021

Several television broadcasters and pay-TV providers have attempted to match over-the-top (OTT) video by offering their own online services. Most notable is the move by HBO to offer a subscription service to their TV shows via HBO Now.

Revenues from subscription video on demand (SVOD) services, such as Netflix and Amazon, are set to more than double from $14.6 billion this year, to $34.6 billion in 2021. Netflix will now grow its U.S. subscriber base to be similar in size with leading traditional pay-TV service providers.


Ongoing SVOD Market Development

According to the latest market study by Juniper Research, SVOD providers will see substantial returns on their expansion and growth strategies, as more countries and markets move to this method of video consumption. And, as more consumers adopt the move away from the old linear, scheduled TV model.

While SVOD continues to draw customers away from traditional pay-TV providers, legacy networks are now seeking to diversify and adapt through progressive strategies, with services such as YouTube and Hulu seeking to offer some linear cable streaming as part of subscription packages in 2017.

The concept is to offer what the industry calls "skinny bundles" of content which are smaller packages, offered at a lower price via Internet delivered services.

Netflix saw rapid expansion in January 2016, launching in 130 new markets simultaneously, bringing its total coverage to 190 countries. Yet, according to the Juniper assessment, international subscriber growth lacks pace, as evidenced in its recent quarterly results.

New Challengers to the Netflix Dominance

Netflix’s expansion has resulted in price increases, but the beneficiaries may ultimately be the provider's rivals if the competitor price differential becomes too great. That being said, it would likely take a long time in the North American market, where typical pay-TV service prices are very high.

"Whilst Netflix has expanded its coverage globally, the test will be whether it can meet its original content production costs, as well as provide quality content to consumers," said Lauren Foye, analyst at Juniper Research.

It's believed that U.S. rival Hulu is now close to offering a somewhat similar amount of content as Netflix, and others are pushing other new business models --  such as Amazon’s monthly subscriptions to Prime video, and YouTube Red subscriptions for exclusive content.

Other key findings from the study include:
  • Total TV and video data usage will grow more than five-fold from 2016 to 2021, as uptake of 4K increases download sizes.
  • Combined 4K SVOD and TVOD (Transactional Video on Demand, i.e. Pay per View and Download to Own) revenues will grow to account for 13 percent of total OTT revenues by 2021.

Popular posts from this blog

How Savvy Pioneers Lead the Future of Work

Hybrid and fully remote work are inevitable in the Global Networked Economy where high-performance talent demands flexibility from employers. To enable these progressive work models, organizations are investing in a wide range of technologies to support more agile types of employment.  According to the latest worldwide market study by International Data Corporation (IDC), leading organizations will spend nearly $1 billion on the Future of Work (FoW) in 2023 -- that's an increase of 18.8 percent over 2022. Future of Work Market Development "Work models continue to evolve, but 37 percent of decision-makers in a recent global survey note that Remote and Hybrid work models will be an embedded part of accepted work practices, supported by a continued shift to the cloud, increasingly instrumented and interconnected physical workplaces, and intelligent digital workspaces," said Holly Muscolino, group vice president at IDC . According to the IDC assessment, organizations must mak

Human Resource Transformation Enabled by IT

Many senior executives are taking a proactive approach to digital business transformation in order to achieve their strategic goals. Delivering revenue growth and profitability is now imperative for every function, including Human Resources (HR). The top 3 priority HR technologies this year are skills management, learning experience platforms, and internal talent marketplaces, according to the latest worldwide market study by Gartner. "With a tumultuous global economy, HR technology leaders face a balancing act in 2023," said Sam Grinter, director at Gartner . "Leaders must anticipate greater levels of accountability and demand for measurable outcomes to justify new technology investments." HR Transformation Market Development Forty-four percent of HR leaders report driving better business outcomes is their number one strategic priority for HR technology transformation over the next three years. Growth in headcount and skills (26 percent) and cost optimization (17 p

Virtual Reality Market Set to Reach $100 Billion

Virtual Reality (VR) market growth is now finally coming to fruition. Thanks to current actions and market momentum, VR is approaching what can be considered critical mass. And, not a moment too soon. This growth momentum comes from new hardware and content releases, accelerating enterprise value recognition, and a significant metaverse wild card that could potentially lift adoption and usage. According to the latest worldwide market study by ABI Research, over 85 million VR Head Mounted Displays (HMDs) will be shipped in 2027 across consumer and enterprise segments, creating a $100 billion VR market that includes hardware, software, and services. Virtual Reality Market Development "Expectations have been high in VR for years, and even decades, without notable growth to show. That growth is finally coming over the next five years," said Eric Abbruzzese, research director at ABI Research . The barrier to entry is lower than ever, all while content performance and user experien