Live-linear OTT viewing to exceed traditional TV by 2020

By Jim O'Neill on Apr 20 2017 at 12:30 PM

Just in time for the annual NAB Show, a new report has surfaced with a forecast that’s sure to prompt an antacid surge among broadcast execs in Las Vegas next week: OTT viewership worldwide will outnumber traditional TV viewership before the end of the decade.

The report, conducted by Unisphere Research for Level 3 Communications, showed half of 500 industry execs surveyed said they expect live-linear OTT viewing to exceed typical broadcast TV viewing by 2020 globally, with nearly three quarters (70%) saying they expected it to happen by 2022.

Researcher NPD, meanwhile, this week pointed out that 60% of U.S. Internet households now had at least one connected TV, an increase of more than 6 million homes from a year ago. NPD surveyed more than 5,300 consumers.

That survey showed 35% of respondents connect via a streaming device like a Roku or Chromecast, compared to 29% a year ago.

More TV manufacturers are migrating to operating systems from Roku, Amazon and Google, which makes it easier for content owners to distribute their assets to more users as there are fewer platforms to navigate.

NPD said the average HH had three devices installed.

The researcher also pointed to the continued value of original content, saying it will drive demand and viewer engagement.

There’s little doubt that an increasing number of consumers are accessing content online; Netflix just reported it would hit 100 million subscribers worldwide this quarter, and the subscription video on-demand market overall is expanding.

Data from Ampere Analysis for North America and Europe contends that 40% of consumers in both regions pay for an SVOD service and pay-TV, noting that the number of pay-TV-only subscribers had declined to 30% in Q1 2017 from 49% in Q3 2015.

Despite the growth in SVOD services, there still remains no clear vision as to whether it or ad-supported online video will prevail.

Unisphere points to a resurgence in transactional video on-demand in the form of pay-per-view for live events.

But it also notes that SVOD services are growing rapidly, with another report from comScore saying there were at least 11 SVOD services that reach one million subscribers monthly in the U.S.

While the jury may still be out as to which model prevails – SVOD, AVOD or TVOD – its certain that online video will be the big winner, and my money is on a hybrid model that takes the best of all three monetization efforts to reach the most viewers – for any length of time – possible.

Stay tuned.

Jim O’Neill is Principal Analyst and Strategic Media Consultant - U.S. West, for Ooyala. You can follow him on Twitter @JimONeillMedia and on LinkedIn

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