Think the US market is saturated in OTT video? Think again. There’s another $100 billion worth of revenue in OTT video to be grabbed globally over the next five years and the majority of it is on domestic shores.
Data revealed by Digital TV Research claims that global revenues from the OTT market are set to nearly double by 2026 from the current level of $106 billion in 2020 to $210 billion.
A big chunk of this change will come from the US market, according to the report. Far from saturated, the analyst predicts revenues will more than double to top $88 billion in five years’ time.
Across the entire OTT industry it is the US that will remain “the dominant territory by some distance,” according to principal analyst Simon Murray. The US share of global revenues will still be 42% by 2026.
The bulk of growth, though, is in international markets, which is where SVODs able to scale fast will score. Scaling here means the ability to localize for culture and language huge volumes of library titles as well as original locally produced shows.
Netflix’s most recent quarterly results show the importance of overseas operations. According to the company, 89% of its approximately 4 million new customers in the first three months of this year came from outside the US and Canada. It has launched in more than 190 countries and plans to invest $500 million in South Korean content alone.
While only 3% of Disney+ content originated outside the US as of mid-March, Ampere reports that a quarter of its new content slate is based overseas.
Meanwhile Amazon has doubled the amount of original local language content each year since 2017. Its international subs rose 80+ percent in 2020 compared with 2019. HBO Max plans to be available in 50+ countries by end of the year and Apple TV+ is currently available in 100+ countries, with both streamers “increasing spending on local-language content as they chase international subscribers,” says Ampere.
DTV Research suggests that China will add $8.4 billion to its OTT revenues to reach $24 billion by 2026, while Japan will see its OTT revenue growth soar by $4.5 billion, taking its annual total to $9.2 billion.
India is also predicted to experience rapid growth, with its OTT revenues more than tripling – up by $4.7 billion to more than $6.7 billion over the next five years.
SVOD revenues will climb by $59 billion to $126 billion by 2026 though its share of the total will dip slightly from 62% in 2020 to 60% in 2026. AVOD revenues will increase by $39 billion over the period to $66 billion to comprise 32% of all OTT revenues by 2026.