OTT Revenues to Nearly Double in 5 Years, Finds Juniper Research
Over-the-top (OTT) video revenues will nearly double by 2022, reports Juniper Research, and the main driver of that growth will be subscription video-on-demand (SVOD) services. While OTT revenue will reach $64 billion worldwide this year, it will grow to $120 billion in 2022.
By 2022, one-fourth of all households worldwide will have an account with an SVOD service.
SVOD's are driving subscriptions by offering premium original programming, which lets them rely less on back-catalog licensing deals. Juniper predicts that Netflix will budget over $6 billion in 2017 and 2018 creating original content. The BBC will budget $1.4 billion. Juniper sees the SVODs' reliance on original content as risky:
“Success will hinge on whether these providers can continue to produce hits such as Stranger Things. As consumers become more fluid in their uptake and loyalty to video services, OTTs could just as easily see users switch off," says researcher Lauren Foye.
Besides spending on original content, OTT services will increase their spending on sports rights. Amazon will probably bid on Premier League rights in February 2018, Juniper notes, suggesting this will be a negative for consumers who will need to subscribe to multiple services to see the content they enjoy.
For more forecasts, the Juniper Digital TV and Video: Network and OTT Strategies 2017-2022 report is available for purchase.
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