Revenues from European subscription video on demand (SVOD) services are expected to nearly triple to $12.4 billion, easily bypassing the combined revenues of ad-based online videos (AVOD), download-to-own video (DTO) and online video rentals, according to a new report.
Currently revenues for SVOD at $4.4 billion, DTO is at $1.2 billion, rental is at $0.9 billion and AVOD is at $3.3 billion. By 2023, DTO is forecast to hit $2.2 billion, rentals 1.4 billion and AVOD $6.9 billion. The OTT revenue total for 2017 was $9.8 billion.
SVOD became the largest revenue generator in the region in 2016, overtaking AVOD, and will own 54% of OTT revenues in 2023, compared to 45% in 2017.
The report, from Digital TV Research, forecast that 69.3% of Western European households (HH) will subscribe to at least one SVOD service by 2023, about 98.9 million subscribers, up from 38% and 50.3 million subs in 2017.
With more than half of the region’s total SVOD subscribers by 2023 (49.8 million), Netflix will remain the largest SVOD service, with Amazon Prime Video at 22 million.
DTVR says it expects 2018 to see subscriber numbers grow by 15 million, with 2019 seeing an additional 11 million new gross subscribers.
The United Kingdom, which already generates the highest SVOD revenues in Europe, will continue to have the lion’s share through 2023, generating as much as second-placed Germany and third-placed France combined by 2023.