Technology is innovating and improving constantly. This fact hits home the hardest when the resources we commonly use are upgraded, connected and made infinitely more accessible. Take the television for instance. The television industry has been at the leading edge of this constant digital disruption. The digital transformation of the media and entertainment industry has given rise to a gamut of OTT streaming services to rival the traditional pay-TV powerhouses.
The number of players in the worldwide OTT streaming market is steadily rising. Participants include global biggies such as Amazon and Netflix as well as independent platforms like TVF Play and Spuul. Consequently, the global Over the Top (OTT) market is getting competitive and congested.
Major Key Players:
Some of the key players operating in the OTT content market include Apple, Inc. (U.S), Facebook (U.S.), Tencent Holdings Limited (China), Netflix, Inc. (U.S.), ActiveVideo Networks, Inc. (U.S.), Google, Inc. (U.S.), Brightcove Inc. (U.S.), Hulu LLC. (U.S.), Microsoft Corporation (U.S), Nimbuzz (Netherlands), Limelight Networks, Inc. (India), Roku, Inc. (USA).
On the basis of content, the market has been segmented into voice over IP (VoIP), texts and images, videos and music streaming. Based on deployment the market has been segmented into on cloud and premise. Based on device or platform, the market has been segmented into gaming consoles, OTT streaming devices, smartphones, tablets, smart TVs and others. By region, the market is segmented into North America, Europe, Asia Pacific and Rest of the World.
Findings from the regional analysis reflect that North America will continue to dominate the OTT content market. This continued prepotency over the market can be credited to factors such as the availability of high-speed connectivity and presence of established content creators and providers in the region. Meanwhile, Asia Pacific is expected to be fastest growing market for OTT content during the forecast period.
This primarily attributable to the increasing number of viewers and a steady but significant rise in local content creators and providers.
Currently, a whopping 300 hours of video are uploaded on YouTube every minute; half a billion people watch Facebook video every day and Netflix has over 110 million subscribers – the latter is on track to see a major upswing due to the current surge in demand for original content. This demand many be fueled by a third of the global population – of which 2 billion are under 25, providing significant room for growth across all streaming content platforms.
India, one of the largest growth markets globally, saw the number of paid digital users double to 2 million in 2018 up from 1 million in the previous year. This number is expected to double to 4 million users by 2020. The growth is led by a large handset market, the second largest in the world. Access to high-speed broadband has enabled Indian brands to launch an onslaught of video content to capture millennials mind space, with a phenomenal data consumption growth to 3.9 GB per month. In the Indian market, Hindi language continues to dominate with 70 percent of content, and 30 percent attributed to regional channels. English currently occupies a miniscule portion.
According to Digital TV Research, global OTT revenues and film revenues will reach USD 129 billion by 2023 from current levels of about USD 50 billion, demonstrating the growth opportunities that lie ahead. While the United States will comprise of about USD 50 billion with 37% market share, China is set to triple its revenues to reach USD 26 billion, taking its market share to 20%. In 2018 itself, Global OTT subscriptions were expected to reach about 470 million, a healthy growth of 20% over the previous year.
Amazon Prime and Netflix dominate the OTT market followed by Apple and Facebook. Furthermore, Tencent Holdings Limited of China, ActiveVideo Networks, Inc. of US, Hulu LLC. Of U.S, Nimbuzz of Netherlands, Limelight Networks of India are some of the biggest OTT platforms globally.
The growth has seen some major broadcasting brands capitalize on demand via acquisitions or launching their own platforms. For example, Viacom, an US multi-national media conglomerate, acquired Pluto TV in January, a free streaming television service based in the US for USD 340 million. The streaming platform has over 100 channels and a substantial catalogue of on-demand content spanning TV series, film, news, and children’s content among others with over 12 million monthly active users.
Seachange, a US-based multinational recently acquired Xstream A/S, a Danish operating cloud-based OTT video and TV platform for broadcasters and telecom providers, for USD 5.5 million. Comcast Cable will be launching OTT service and will be offering free services to over 50 million subscribers. Brightcove, a US-based streaming service, acquired Ooyala Inc (video content management and publishing) for USD 15.2 million.
Altice France, a subsidiary of Altice Europe, a leading operator in telecoms and media in France, is currently in negotiations to acquire a majority stake in OTT platform Molotov, a platform boasting of 7 million subscribers. The synergies are self-explanatory.
The fan-base of Soccer subscribers is being tapped by UEFA as it intends to have a streaming service later this year, with broadcasts of women’s and youth soccer matches, expanding its viewership.
In the Middle East, StarzPlay Arabi has beaten Netflix in its own territory, and secured funding to the tune of USD 125 million and over 700,000 subscribers. In the United Kingdom, one of the largest OTT markets, Britbox, BBC’s for profit unit, now has 500,000 subscribers, doubling its base in just a year. Even though it is much lower than the 25 million subscribers, its expansion demonstrates scope.
In India, Hotstar is the clear market leader with almost 70 percent market share while SonyLiv and Voot command another 20 percent. Homegrown Zee Media is one of the largest television networks and is expanding its OTT platform service ZEE5 at a breakneck speed. Though Amazon Prime is the market leader globally, it is still behind in India. In fact, Netflix and Amazon, two of the biggest global OTT players, will be vying for a significant piece of the anticipated USD billion market by 2023, which is ten times 2018 levels, according to the global consultancy, Boston Consulting Group.
This jump is due in part to growth in hand held devices, the increasing digital drive of the Indian Government and rising disposable income aided by urbanization. OTT players intend to spend almost USD 4 billion in the next three years, with a particular focus on ramping up regional content. The country’s 400 million viewers will see significant investments from both domestic players as well as the international OTT companies. According to Pwc-Assocham (an industry chamber), India’s market size is expected to be about USD 1 billion in the next 3 years clocking a significant growth rate.
DAZN is a new way to watch sports. It is a subscription video streaming service owned by Perform Group. The service is dedicated to sports, offering live and on-demand streaming of events from various properties. It first launched in Austria, Germany, Japan, and Switzerland in August 2016, and in Canada the following year. It was launched in the United States and Italy in 2018, and will launch in Spain and Brazil in 2019.Over 100 fight nights a year from Matchroom USA, Golden Boy Promotions, Bellator, World Boxing Super Series and Combate Americas. Plus access to ChangeUp, the new DAZNxMLB live look in baseball show, on every night. Just $19.99/month or an entire year for $99.99.
Amazon Video is an Internet video on-demand service developed and operated by Amazon. It offers television shows and films for rental or purchase. Amazon has pursued a number of exclusive content deals to differentiate its service from competitors, including a multi-year licensing deal with HBO. Amazon video is available in the US, the UK, Japan, Germany, and Austria, and the company has plans to expand its video service into India in the near future.
YouTube is an American video-sharing website headquartered in California. It makes use of the latest video technology to display a wide variety of user-generated and corporate media videos. Available content includes video clips, TV show clips, music videos, audio recordings, movie trailers, and other content such as video blogging, short original videos, and educational videos. Most of the content on YouTube is uploaded by individuals, but media corporations including CBS, the BBC, Vevo, Hulu, and other organizations offer some of their material via YouTube as well.
Netflix Inc. is an American multinational entertainment company. It specializes in and provides streaming media and video on demand online and DVD by mail. In 2013, Netflix added film and television production, as well as online distribution. It now offers its “Netflix Original” content through its online library of films and television. As of July, Netflix reported having over 83 million subscribers worldwide.
Hulu is an American subscription video on-demand service owned by Hulu LLC. It is primarily focused on television series, offering episodes from a variety of series from its owners’ respective television networks and other content partners. In 2016, Hulu established a joint venture with Yahoo!, Yahoo! View, and also announced that it intends to launch a service with live television programming in 2017.
Other prominent vendors
Apple Inc. is an American multinational technology company headquartered in California that designs, develops, and sells online services, computer software, and consumer electronics. Apple iTunes, a media player and library, offers movies and tv shows, in addition to music and apps, which are available for purchase and download. Apple is the world’s largest information technology company by revenue, the world’s largest technology company by total assets, and the world’s second-largest mobile phone manufacturer.
TalkTalk TV Store
TalkTalk TV Store, formerly Blinkbox, is a UK-based transactional video-on-demand (VoD) service available on Macintosh and Microsoft Windows computers, games consoles, tablet computers and Smart TVs. Content is usually streamed, with downloading currently possible on Windows PC/laptops. The Blinkbox brand has been extended to companion services offering digital music and books.
CinemaNow is an international over-the-top (OTT) provider of on-demand Internet streaming media available to viewers in the United States, Canada and the United Kingdom. The company was founded in 1999 and is headquartered in California. The CinemaNow platform is available on the web, on mobile devices running iOS and Android, the Xbox and PlayStation game consoles and CE devices including Samsung, LG, Panasonic and Toshiba.
Cox Communications is a subsidiary of Cox Enterprises providing digital cable television, telecommunications and Home Automation services in the United States. It is the third-largest cable television provider, serving more than 6.2 million customers, including 2.9 million digital cable subscribers, 3.5 million Internet subscribers, and almost 3.2 million digital telephone subscribers, making it the seventh-largest telephone carrier in the country.
Crackle is an online distributor of original web shows, movies, and TV shows. Founded in the early 2000s as Grouper and rebranded in 2007, Crackle is owned by Sony Pictures Entertainment. The service is free with commercials on all supported platforms.
Deutsche Telekom is one of the world’s leading integrated telecommunications companies, with approximately 156 million mobile customers, 29 million fixed-network lines, and more than 18 million broadband lines. The company provides fixed-network/broadband, mobile communications, Internet, and IPTV products and services for consumers, and information and communication technology (ICT) solutions for business and corporate customers.
DirecTV is an American direct broadcast satellite service provider and broadcaster and a subsidiary of AT&T. DirecTV provides television and audio services to subscribers through satellite transmissions, and subscribers have access to hundreds of channels.
Indieflix, Inc is an independent film distribution and online streaming service based in Seattle, Washington. IndieFlix provides access to thousands of high quality independent shorts, features, documentaries, and web-series from film festivals around the world. Its service is available on Fire TV, Roku, Xbox, and all internet connected devices including smart phones, smart TVs, and tablets.
Popcornflix LLC is a website and OTT service offering free, ad-supported streaming video of movies and webisodes. It is owned by Screen Media Ventures. The site primarily streams independent feature films, many of which come from Screen Media’s library. The service is currently available in the United States and Canada, and the company has plans for expansion in the future.
Rovi Corporation, based in the United States, offers copy protection, software licensing and “search recommendation” for devices including set-top boxes, digital video recorders, TVs, and mobile and tablet devices. Companies such as consumer electronics manufacturers, cable operators, websites, and social networks use Rovi’s entertainment metadata to provide their own digital video content.
SnagFilms, established in 2008, offers advertising-supported documentary and Independent films. Films are streamed on the website, which contains a library of over 5,000 films. Additionally, filmmakers have the ability to submit their own documentaries for consideration.
Vudu, Inc. is a content delivery and media technology company. The company distributes full-length movies over the Internet to television in the US using a peer-to-peer content delivery network. Vudu is also available within PlayStation 3, PlayStation 4, Xbox 360, Xbox One, iPad, TiVo Roamio, Roku devices and most smartphones via the Vudu app. Vudu was acquired by Walmart in 2010.