The unexpected rise of the COVID 19 pandemic has been the harbinger of unprecedented growth in the global OTT market. Even before the lockdown started the OTT market had grown by 15% in 2019. With the pandemic on a rise and lockdowns being extended, people are afraid to venture out. Most of the cinema halls, malls, adventure parks have been shuttered for a good part of this year, and consumers are left with very few entertainment options. They invariably seek to find means to entertain themselves in the safe confines of their homes. And this is where OTT platforms have come to the rescue. Key OTT Video-On-Demand Growth Statistics: According to Brightcove’s the percentage of viewers in the entertainment sector has risen by 30% in the first half of 2020 as compared to 2019. A Research& Markets report states that Western Europe is forecast to have 197 million SVOD subscriptions by 2025, doubling from 88 million at end-2019. Spurred by COVID-19, about 45 million subscribers will be added in 2020 alone. OTT consumption has skyrocketed in India as International brands like Amazon Prime and Netflix reported a 67% & 65% uptick in subscriptions, respectively. Indigenous players like Zee Network’s Zee5 and AltBalaji recorded an 80% and 60% rise in subscriptions & user base, respectively. Increase in the number of viewers: Q2 2020 Global Video Index, Current estimates state that the average time spent on subscription OTT Video-on-Demand content in the US alone has risen by 23% from last year and is expected to surpass 62 mins per day in 2020. This is quite an accelerated growth as compared to 2019 when it grew by 15% y-o-y. Increase in viewing time span: Yet another statistic gleaned from is that Indians spent around 4,600 crore minutes a day on OTT platforms during March 2020. But as the nation went into lockdown, these figures skyrocketed to 6,000 crore minutes. This is a 30% growth on a month-on-month basis. CNBC-TV18’s Trendspotting report According to a , the global over-the-top (OTT) market which accounted for $110.1 billion in 2018 is expected to garner $438.5 billion by 2026 growing at a healthy growth rate of 19.1%. The OTT market has already garnered USD 155.6 Bn in the current situation. Increase in revenue from OTT Market: Research Dive report Catalysts in the growth of the OTT Video Services Market: Of course, COVID has enabled OTT video to be a major source of entertainment for viewers. However, let us then look at some of the factors which along with the pandemic have accelerated the OTT video consumption: A key driver in accelerating the growth of the OTT video segment worldwide is the marked increase in broadband penetration. COVID 19 especially has made governments realize the value of advanced connectivity and its applicability in use cases such as advanced telemedicine, remote working, and education through augmented and virtual reality. Increasing broadband penetration: 5G has the potential to power mobile technology use cases, through increased mobile adoption and expanded high-speed broadband internet access via fixed wireless access (FWA). Therefore, Governments all over the world are investing in high-speed broadband initiatives to amplify broadband coverage and adoption. Developing countries that lagged in previous network deployments are making 5G network development a national priority, even as they struggle with near-term affordability. All these initiatives have been playing a crucial role in OTT video success. There are 4.78 bn mobile phone users in the world today which accounts for approximately 62% of the world population. Out of this 3.5 bn are smartphone users. By simply connecting their smart devices with the subscribed OTT services, viewers gain access to content anytime, anywhere, and on their device of choice. Smartphone penetration & accessible high-speed mobile internet: This is also aided by the fact that Mobile Network Operators (MNO), particularly in emerging countries in the APAC & MENA region, have accelerated the rollout of mobile broadband & LTE. At the same time, MNO partnerships and bundling of packages have made it affordable for consumers to gain access to even more content on their mobile devices. Therefore, the mobile channel is quickly emerging as the most preferred video delivery platform as well as the predominant service distribution channel for accelerated growth. OTT video was born out of the cord-cutting mindset. People did not want to be tied down to specific times to view content. Instead, they wanted to view content at any time, any place, and on any device of their choice. And thus, emerged the OTT video on demand as we know it today. Advances in media streaming technology: Technology has played a pivotal role in the propagation of OTT video services. Complimentary features such as streaming services being cloud-based, support to Live-content with Video-on-demand (VOD), a large content repository, zero-buffering, adaptive bitrate streaming, the intuitive content discovery make OTT platforms easy to use. Internet penetration & proliferation of smart devices along with an increase in disposable income have enabled users to avail OTT services at the click of their fingertips. Consumers want to have the freedom of choosing the genre and watch the content as per their comfort and flexibility. Personalization in OTT Apps: This has driven the adoption of VoD services and thus home entertainment has made its way via streaming services. Localization of content, a gamut of choices with regards to genre, titles, personalization, and flexibility of viewing on any device at any place and anytime has provided a seamless experience to viewers. From an OTT services provider perspective, such deep consumer insights gleaned from OTT apps helps them tailor their offerings by making data-driven decisions. Innovative pricing techniques adopted by several OTT players have helped attract and retain customers on their OTT platforms. OTT Video on Demand can be monetized under various models such as SVOD, TVOD or AVOD. However, there is yet another popular model that is being used by OTT platforms players these days and it is the Freemium model. While prospective subscribers deliberate whether to sign up for an OTT service or not, OTT Players have come up with this “freemium” model. Innovative pricing models: In this model, open access to a select catalog of content is provided as an incentive to gain new subscribers, while access to premium content is chargeable to pay subscribers. This helps drive up the average revenue per user (ARPU) as well as grow the subscriber base. Here the free content business model is supported via ad-supported advertising. Again, this is a good strategy to capture market share in developing countries, however, it will not work the same way everywhere as different pricing models are applicable in different markets. For instance, OTT Players in India are adopting aggressive distribution and pricing strategies, including sachet pricing and mobile-only packs introduced by Netflix meant for the Indian markets. The rising popularity and demand for OTT is a ray of hope at a time when production has halted, and no new fresh content is being created. Streaming hasn’t stopped via the OTT platforms and subscribers are hungry for more content. While linear TV viewership has increased by approximately 6-7%, OTT VOD viewership has increased by 38% during the COVID crisis. Therefore, production houses are taking a plunge in the digital space to monetize their existing content. T Growing demand for exclusive content: he fact that they have a good handle over the consumer preferences and vast production experience will help them tailor their offerings accordingly to the market. For instance, broadcasters such as the BBC have launched its on-demand platform which allows viewers to stream content, sometimes ahead of it airing on television. This approach enables broadcasters like BBC to keep up with consumer demand and the competition while maximizing their content. Along with showcasing original content, OTT service providers have begun establishing exclusive tie-ups with broadcasting networks to offer personalized TV experiences. Few examples of such mutually beneficial partnerships are Sky partnering with Netflix and Disney+, AltBalaji with Zee5, Hotstar with Star India, MX Player with Arré and Hoichoi, and Hulu with ABC and NBC. Such mutually beneficial partnerships with bundled offerings will help OTT providers present a more captivating offering and appeal to many customers. It would also imply that instead of being competitors, OTT service providers, production houses, and broadcasting networks are working together to gain a more solid share of the market. This is especially favorable in the current situation where consumers are inclined towards stacking two or more platforms. With millions of people under lockdown orders because of the pandemic, OTT viewership has skyrocketed. While on one hand, the pandemic has introduced opportunities to super-serve consumers, on the other it also has created new challenges for all companies in the space. Research from intuitive video management platform Imagen shows that even though a majority of people are subscribed to some OTT platform or the other, there is still a secluded set of 30% of consumers who do not have access to any of the popular streaming platforms. The figure rises to 51% among those aged over 55. And if that is the case then there is an opportunity for OTT providers to flourish by tapping into the lucrative 30% of consumers who are not subscribed to any platform yet. At the same time, they must prevent subscriber churn by improvising and innovating their current offerings. In our upcoming blog, we will explore the various technological advancements that can be implemented in the OTT space so that the market continues to grow and flourish even as normalcy returns. References: https://www.emarketer.com/content/time-spent-with-subscription-ott-video-content-us-will-surpass-hour-first-time-this-year https://www.businesswire.com/news/home/20200818005479/en/Streamed-Video-Content-Dominates-Media-and-Entertainment-Consumption-in-India-According-to-the-Brightcove-Q2-2020-Global-Video-Index https://www.prnewswire.com/news-releases/global-over-the-top-ott-market-to-rise-and-hit-a-revenue-of-438-5-billion-during-the-covid-19-catastrophe--research-dive-301092889.html https://www.timesnownews.com/videos/et-now/markets/how-has-the-covid-19-lockdown-impacted-the-ott-platforms-nachiket-pantavaidya-to-et-now/65203 https://www.marketwatch.com/press-release/global-over-the-top-ott-market-factors-influencing-the-growth-rate-in-media-entertainmentinteractive-media-services-sector-to-reach-cagr-of-1161-2020-06-22?tesla=y https://www.businesswire.com/news/home/20200520005350/en/Global-OTT-Streaming-Market-2020-2030-- https://www.prnewswire.com/news-releases/global-over-the-top-services-ott-market-outlook-2020-2024---market-set-to-reach-157-billion-by-2024-with-vod-growing-at-the-highest-cagr-300986693.html https://variety.com/2020/digital/news/coronavirus-covid-ott-streaming-video-impact-webinar-1234584777/ http://www3.weforum.org/docs/WEF_Global_Accelerator_Program_5G_Outlook_Report_2020.pdf Previously published at https://hsc.com/Blog/How-COVID-19-Has-Fueled-The-Global-OTT-Video-Business

Amazon

Disney

Discovery

Netflix

Super

Tesla

OTT Streaming Market to Reach $169.4 Billion by 2023: How to Capitalize

The Emergence of IoT Security in The Post-COVID-19 World

Leaders in next gen technologies, digitally transforming businesses.

Read My Stories

Too Long; Didn't Read

Make resilience your competitive advantage

The Effect of COVID-19 on The Global OTT Video Business

About Author

Comments

TOPICS

THIS ARTICLE WAS FEATURED IN

Related Stories

Untitled Story

Improve Monetization By Optimizing In-Store Analytics and Trendspotting

10 Best Platforms To Build a Live Video Streaming Website, App or Service in 2022

Nobody Cares Which Live Streaming App Is "Best"

The Technology That Powers Your Favorite Video Streaming Services

WebRTC: All You Need To Know About its Advantages and Technical Challenges

Improve Monetization By Optimizing In-Store Analytics and Trendspotting

10 Best Platforms To Build a Live Video Streaming Website, App or Service in 2022

Nobody Cares Which Live Streaming App Is "Best"

The Technology That Powers Your Favorite Video Streaming Services

WebRTC: All You Need To Know About its Advantages and Technical Challenges

Light-Mode

Classic

Newspaper

Dark-Mode

Neon Noir

Minty

HN StartUps