OTT pay-TV to rocket to $10BN by 2018
| 20 November 2014
The over-the-top (OTT) pay-TV market is set to enjoy huge success, growing from $5.8 billion in 2014 to just over $10 billion in 2018 says research firm Infonetics.
amazonMaking a general assessment of the pay-TV market in its Pay TV Subscriber Database and Video Equipment Tracker, Infonetics calculates that the overall global pay-TV market was worth $117 billion in the first half of 2014, an increase of 3.9% compared with the first half of the previous year. It found that satellite and telco pay-TV service revenue continued to grow, driven by new subscribers and increased average revenue per user (ARPU) in North America and Western Europe. Pay-TV subscribers reached 837 million after the first six months of 2014, growing 10% over 2013, with the strongest growth again coming from the telco pay-TV segment. However, the firm warned that much of the increased revenue per user is being offset by ever-increasing content costs.
That said, things look very rosy for the OTT Industry, noted Jeff Heynen, principal analyst for broadband access and pay-TV at Infonetics Research. "Subscription-based over-the-top (OTT) providers like Netflix, Hulu Plus and Amazon have seen phenomenal growth over the last couple of years," he remarked. "With a combination of wide availability across end devices, user-friendly interfaces, and access to vast content libraries, these providers continue to challenge traditional pay-TV providers and are in the early stages of siphoning off revenue.
"But beyond this approach, OTT providers are now expanding their relationships with traditional pay-TV providers to get their apps and services integrated directly onto consumer set-top boxes (STBs), gaining access to a much larger pool of current pay-TV subscribers."