Online services such as Netflix and Amazon Prime Video have transformed the video business in recent years, but according to the latest research from Strategy Analytics, revenue increases will be even higher in the next four years than in the previous four years.
The report concludes that global video revenues, including online, physical media and advertising, reached $70.2 billion in 2017, an increase of $29.4 billion since 2013. Over the next four years, the increase in dollar terms will be even greater ($36.3 billion), taking total industry revenues to $106.5 billion in 2021.
Other key findings from the research include:
- In 2017, online revenues, including consumer spending and advertising, accounted for 84% of the total video market, compared to 52% in 2013.
- Subscription VOD revenues rose by more than a third in 2017 and are forecast to reach nearly $50 billion by 2021.
- Advertising alone now accounts for 38% of total video revenues.
- The US accounts for the largest share of global online video revenue in 2017 (47%), followed by China (10%) and Japan (6%).
- Physical media such as DVDs and Blu-ray discs accounted for 16% of revenue in 2017, down from 76% in 2010.
- Average annual video revenues per household vary greatly, from $270 in North America to less than $5 in the Middle East and Africa.
Michael Goodman, Director of TV and Media Strategies at Strategy Analytics said:
“The online video market is being driven by subscription-based business models and advertising, alongside a relative decline in download-to-own and rental models. Netflix and Amazon are the headline acts but many other streaming video services around the world are also gaining traction as the video market continues to expand”.