Michelle Clancy | 20-08-2013
Although video consumption has never been stronger than today, global video market revenue is slowing down because of a permanent decrease in physical video distribution revenues. Nonetheless, worldwide video and television revenue will increase from €392 billion in 2012 to €483 billion in 2017, according to iDate.
Pay-TV revenue will grow by 22.7% between 2012 and 2017, or by an average 4.2% annually, to reach €210.2 billion in 2017. Ad revenue will enjoy even stronger growth of 25.8% between 2012 and 2017, to reach €191.4 billion in 2017. Public financing/licensing fees will continue to increase significantly (+7.5% in five years) to reach more than €37 billion in 2017.
Linear television will continue to generate nearly 91% of video market revenues, but business models for traditional TV are subject to the pressure of video over-the-top (OTT) services, according to Florence Le Borgne of the French research company.
In this context, the number of TV households worldwide will reach 1.647 billion in 2017 (+9.9% in 5 years) and the number of digital TV households worldwide will come to 1.443 billion in 2017, which translates into 87.6% of TV households.
Cable will remain the chief access channel worldwide (571.7 million households in 2017), but will gradually lose ground to satellite and IPTV which will account for 32.4% and 8.5% of TV households, respectively, at the end of 2017.
Despite the development of hybrid TV solutions, terrestrial TV will continue its decline and drop down to No 3 spot by 2017, with roughly 24.4% share of the global market.
Meanwhile, video-on-demand (VOD) revenue will reach €34 billion in 2017, 150% more than in 2012. OTT video will continue to be the biggest earner, generating 74% of total revenue. VOD will still be the dominant model on managed networks. It will generate €6.6 billion in 2017 versus €2.2 billion for subscription video-on-demand (SVOD).
As for video hard copy sales, they will total €10.3 billion in 2017; they are a part of a continuous decline as the global market will have shrunk to half of what it was in 2012. Blu-ray will be the most common format, while the rental market will overtake the permanent sales market.