According to the Global SVOD Forecasts report, the number of Subscription Video On Demand (SVOD) homes will reach 428 million across 200 countries by 2021 – a massive increase on 2015’s 177 million and 2016’s 248 million!
Currently, North America is the country where consumers are most likely to subscribe to SVOD service. However, by 2019, Asia Pacific will become the top region. Despite Netflix being unlikely to secure direct access to China, and despite the company making only limited inroads in population centers such as India and Indonesia, large SVOD platforms in the region are becoming increasingly popular – especially via smartphones.
However, with a predicted 217 million subscribers by 2021, the US will continue to be the SVOD market leader for some time, with China (with a predicted 74 million users by 2021) in second position.
Netflix will do particularly well and is forecast to have 188 million paying subscribers by 2021. That figure represents 27.5 percent of the global total SVOD market! In 2018, the majority of the company’s subscribers will be international (though 44 percent of its paying subscribers will be US-based in 2021).
Speaking of Netflix’s future growth strategy, Simon Murray, Analyst at Digital TV Research, said: “We estimate that Netflix has distribution partnerships with 79 pay TV, telco or mobile operators across 44 countries. These partnerships include multinational deals with Liberty Global, Millicom/Tigo and Telia.”
The huge uptake in SVOD will allow Netflix to double its 2016 revenue ($6.37 billion) and make a predicted $13.14 billion in 2021. In total, global SVOD revenue is forecast to be $32.18 billion in 2021 – a whopping 18 times the $1.74 billion recorded in 2010 and up $20 billion on 2015’s $12.20 billion.
The report makes it clear that consumers will continue to flock to SVOD, and that they will do so for some time to come. This growth is supported by the increasing prevalence of high-quality internet providers worldwide, the growth of the smartphone market and other streaming device providers, and a maturing SVOD industry (where established players have and will continue to improve their offerings and prices, and where new providers entering the sector will keep competition high).
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