VOD to the fore as UK video industry 'comes of age'
DetailsJoseph O'Halloran | 17 June 2015
A growing appetite for digital services, the resilience of packaged retail and a healthy box office have led to a very buoyant UK video market right now says Futuresource Consulting.
The latest in the analyst's video insights reports found that the total digital market grew by an impressive 55% year-on-year to be worth over £600 million at the end of 2014, almost four times the level of 2011. It adds that the digital video sector has been significantly helped by the rollout of fibre broadband and the wider availability of services on a fast growing connected device base, particularly relating to viewing on a TV screen. This combination, it argues, has led to a vastly improved viewing experience for many in the online video sector, encouraging consumers to pay for premium content.
Of all the sectors, digital video was in particularly good health driven by a buoyant on-demand industry, attracting new customers to both transactional (electronic sell-through) and streaming services video. Futuresource said that 2014 was a breakthrough year for EST in particular, as new and evolving services helped reach new customers.
Meanwhile the report found that the subscription video-on-demand (SVOD) sector in the UK went from strength to strength with three key players, Netflix, Amazon Prime Instant Video and NOW TV growing 'impressively" in the eyes of the analyst. Futuresource calculates that at the end of 2014 there were over seven million individual subscriptions, and expects this number to almost double to 13.6 million by 2019, with associated value crossing the £1 billion threshold in 2019.
"The digital video market came of age in 2014," commented Futuresource senior marketing analyst David Sidebottom. "Although SVOD more than doubled in 2014 and now accounts for over half of total digital video at £350 million, nearly 30% growth in transactional digital video in 2014 was perhaps more impressive given the disappointing performance in 2013 and 2012."
Futuresource projects that the total digital video market will continue its momentum in 2015 with anticipated growth of 40%, reaching £870 million.