SVOD: a 'tiny' 5BN TV market in 2015

DetailsJoseph O'Halloran | 14 January 2015

Deloitte's technology, media and telecommunications (TMT) practice has predicted a great year for SVOD and online video but has noted the small size of their overall contribution to the TV industry as a whole.

TMT predictionsIn its traditional New Year investigation of the TMT markets, the industry analyst forecasts that even though subscription video on-demand services such as Netflix will generate about 5 billion globally this year, this will only be around 3% of the 168 billion pay-TV market as a whole. Deloitte suggests that SVOD should not be considered solely as a competitor to pay-TV but more as a complementary service and replacement for DVD box sets. In addition, it believes that SVOD players will struggle to match TV broadcasters' investment in brand new high-end content.

Deloitte comes to a similar conclusion as towards the prospects for short-firm video which, despite the enduring huge popularity of services such as YouTube, it says will not overtake traditional, long form television viewing any time soon. Deloitte estimates that short form video clips should generate 10 billion hours of viewing a month, and revenues of over 3 billion. This compares with traditional television content that it calculates will have advertising and subscription revenues worth over 260 billion in 2015, and viewing of 360 billion hours per month.

"The most successful video bloggers will generate billions of views," observed Neil Allcock, lead media partner at Deloitte. "However, the total time spent watching short online video clips, will represent under three per cent of all video (long- and short- form) watched on screens globally."