Global streaming revenues will surpass US$72 billion in the next four years, according to a new PricewaterhouseCoopers (PwC) study that reveals the closing of the financial gulf between pay-TV revenues and income from the emerging over-the-top (OTT) market.
The Global Entertainment and Media (E&M) Outlook 2019-2023 report predicts that the size of the OTT-video sector will have expanded to more than a third (35.4 per cent) of the size of the television subscription market by 2023, almost doubling from 18.6 per cent in 2018.
The acceleration of pay-TV subscription cancellations and an increasing appetite for video on demand (VOD) continues to drive change, the consumer research report claims. However, a correlation between data consumption in emerging markets where broadband access remains low is also said to be having a significant impact in a swing in digital advertising growth.
‘Consumers are using an expanding array of connected devices to organise, curate and discover their own unique worlds of media,’ the report explains. ‘In response, companies are designing their offerings to revolve around personal preferences, using data and usage patterns to pitch their products not at audiences of billions, but separately at billions of individuals.
‘As this report explains, this increasingly tailored world has major implications for every E&M business across every segment. Whether the subject is business and revenue models, emerging technologies, or regulation and trust, companies must keep on top of current and future developments – and be sufficiently agile, ready to respond proactively and at pace.’
For example, digital advertising growth in India (17.5 per cent) and Nigeria (14.4 per cent) is expected to grow well above the industry standard (9.5 per cent), according to PwC’s insight. Meanwhile, both nations are anticipating substantial growth in data consumption too (40.9 per cent in India and 44.9 per cent in Nigeria), spurred by the rollout of 5G connectivity.
‘There are also stark different among markets in terms of which segments of media are growing strongly and which are performing less well,’ the report continues. ‘The projected growth rate of digital advertising in Nigeria through 2023, for example, is almost three times that of Germany.
‘Such contracts are increasingly being seen among developed markets as well. It was once assumed that where the US led in E&M revenue trends, the rest of the developed world would eventually follow. But data in this year’s Outlook suggests that this generalisation no longer applies.’
This aggregation of content is also apparent in the proliferation of the gaming industry, with esports predicted to drive advertising and sponsorship growth beyond $US500 million by 2023, while media rights in the sector are expected to climb above US$400 million.
‘Part of the evolution will be for marketers to find consumers in the places where they are choosing to spend their most precious resource: time,’ the report continues. ‘Esports and gaming are two areas in which individual consumers control their own journey, and consumer and engage at their own place and discretion, often as audiences of one.
‘Accordingly, these segments are emerging as important new arenas for content creators and marketers… And esports leagues, which have shown the ability to aggregate large audiences, are turning individual players into groups of viewers.”
report fromSports Pro Media