Connected device makers give boost to broadcasters’ OTT revs

Joseph O'Halloran | 22-08-2012

Within the next five years, 27% of OTT video transactions will be initiated via fixed connected CE within the home, accounting for 46% of world over the top (OTT) market revenues generated, according to a new study from IMS Research.

In its new study “Business Model Evolution in OTT and On-demand Video Markets – 2012 Edition,” the analyst predicts that in 2017 broadcasters will account for 17% share of world OTT video market revenues and pay-TV operators for 11% share.

The study calculates that broadcasters will generate $1.8 billion in OTT market revenues in 2012, mostly through advertising, and will grow this to $5.9 billion in 2017. Furthermore, it suggests that over the next five years, more broadcasters will attempt to monetise back catalogue content via the pay-per or subscription model, as well as look to international expansion as a means of generating OTT revenues, as in the case of the BBC’s global iPlayer app.

Explaining further reasons for this growth, IMS says that the global breakout of Amazon (owner of LOVEFiLM), Apple and Netflix is among the key drivers of the adoption of OTT video via connected devices, both fixed in-home devices and portable CE such as tablets and smartphones. Furthermore, IMS regards platforms such as YouView and HbbTV as further enabling broadcasters and pay-TV operators to extend the reach of their existing video assets.

“Broadcasters need to be innovative on how to effectively monetise their content beyond the traditional means because content such as movies and fictional TV series are expected to transition to on-demand delivery more rapidly. With OTT technologies, broadcasters are given an opportunity to complement their broadcast offerings, to improve sports and live events, and to monetise content that has passed the 7-day catch-up TV window,” Anna Hunt, principal analyst with IMS Research and author of the study.