Over-the-top TV revenue to hit US$ 5.6bn in 2014
15.09.09

Worldwide revenue from the delivery of Internet video to the TV will grow nearly six-fold over the next five years from US$ 1bn in 2009 to US$ 5.7bn in 2014, according to a new report from The Diffusion Group.

According to Colin Dixon, Senior Partner and digital video expert at The Diffusion Group, pay-per-view services will account for 96% of global over-the-top (OTT) video revenue in 2009, leaving subscription services with only 4% of the revenue mix. However, by 2014, annual OTT subscription revenue will have grown 50-fold and account for 31% of global revenue.

Mr. Dixon adds that current hardware trends are fuelling this growth, specifically the ongoing shift to broadband-enabled TVs and the rapid diffusion of ancillary Web-enabled platforms such as games consoles, Blu-ray players and hybrid set-top boxes. Widespread penetration of these platforms is expected to set the stage for a rapid uptake of Internet-to-TV video services, both pay-per-view and subscription-based, according to the report.

As these platforms become more widespread and consumers become more comfortable with using Internet-based TV services, the market will be primed for the arrival of fully-fledged pay-TV replacement services, according to The Diffusion Group. Subsequently, the company expects that there will be "major" OTT service announcements in virtually all global regions in 2010 and 2011, both in terms of stand-alone OTT and hybrid pay-TV/OTT television services, both of which will help fuel the growth in OTT subscription revenue to US$ 1.8bn in 2014.

By 2014, North America is expected to account for the "vast majority" of global OTT subscription revenue (US$ 830mn), followed by Asia with US$ 490mn, and then Europe with US$ 407mn. Other geographic regions meanwhile will account for just US$ 60mn of this total.