Online TV and video revenues to hit $35bn

Global revenue for online TV and video over fixed broadband networks will reach US$34.99 billion in 2018, according to new forecasts by Digital TV Research.

The research predicts revenues in this space to almost double in the next five years, with the revenue to climb from just US$3.98 billion recorded in 2010 and an expected US$15.94 billion in 2013.

Online TV and video advertising is expected to help drive this growth, contributing revenues of US$7.4 billion in 2013 and US$16.4 billion in 2018. However, advertising’s share of total OTT revenues is tipped to fall from 60.6% in 2010 to 46.9% in 2018.

The fastest growing OTT revenue stream will be subscription video-on-demand, said Digital TV Research, claiming that while the likes of Netflix and Hulu Plus are well established in North America, international markets have so far been “relatively untouched”.

It predicts that SVOD revenues will climb from US$1 billion in 2010 to $6 billion in 2013 and $13 billion in 2018, with the number of homes paying a monthly fee for online video to reach 67.8 million by end-2013 and160.6 million in 2018.

This will “stifle the pay-per-view or rental market somewhat,” said the research, though these revenues are still expected to climb from $207 million in 2010 to $2.10 billion in 2018.

“The OTT TV sector is on the brink of a huge take-off as the key players expand internationally, broadband penetration increases, technology advances and as new partnerships are announced on a daily basis,” said Simon Murray, principal analyst at Digital TV Research.

By 2018, 520 million homes in 40 countries will watch both paid-for and ad-supported online television and video, up from 182 million in 2010, according to the forecast.