OTT TV and video subscriptions to reach two billion globally by 2025, says report

mockup 5215927 640Juniper Research’s new report found that there will be almost two billion active subscriptions to on-demand video services in 2025, an increase of 65% by the end of 2020

This growth's primary driver will be traditional broadcasters, increasingly turning to streaming services to expand their reach and compete with online video giants such as Netflix and Amazon Prime Video.

The new research, OTT TV & Video Streaming: Evolving Trends, Future Strategies & Market Forecasts 2020-2025, notes that traditional broadcasters are turning to hybrid services, a combination of subscription- and advertising-supported monetisation, such as NBC’s Peacock, and CBS All Access, which offer tiered services that still generate subscription revenue but show advertisements in lower-priced bands in order to keep end user prices down. Juniper Research anticipates that these services will account for US$1.4bn in advertising spend in 2025.

Further monetisation to combat subscription fatigue

Juniper Research’s report notes that, as subscription services become increasingly prominent, different models will be needed to combat subscription fatigue in particular in the US. The report estimates an average of four SVOD subscriptions per household in the USA in 2020 but that growth decreased significantly from 2021.

“Thanks to this high level of market saturation, streaming providers need to keep their offerings competitive to retain subscribers”, noted research co-author Nick Hunt. “Hybrid monetisation is one way that VOD providers can keep their offerings low-cost, and therefore less likely to be dropped.”

Social video brings lower ad growth

The report shows that more than 70% of streamed video sessions will take place on smartphones over the next five years, thanks to the emergence of social videos on platforms like TikTok. However, they do not yield a high number of advertising slots per video watched, which means that smartphone advertising spending will only increase at an average rate of 2% per year over the forecast period.

twn Are you sure that you want to switch to desktop version?