Businesses of all shapes and industries are being hit hard by coronavirus. According to a new report from Convergence Research Group, streaming video doesn’t seem to be one of them. This isn’t a huge surprise since we are all at home, but data to support that the streaming wars wage on always helps right?
Convergence Research Group looked at 77 OTT services, led by Netflix, Hulu and Amazon, and estimates that OTT access revenue will grow 29% to $28.5 billion in 2020. That’s in addition to the 35% gain we saw in 2019, and anticipated revenues to hit $44.2 billion in 2022.
Quarantine life has fueled such streaming growth that Peacock may expedite the global rollout of their platform and Roku estimated that it ended March 2020 with a net increase of about 2.9 million active accounts from the prior quarter.
Unfortunately for linear TV, Convergence Research’s Couch Potato results aren’t as rosy.
U.S. MVPD access revenue was down about 3% in 2019 and a 6% drop is expected in 2020. And lighter fluid will be added to the nosedive in 2021 and 2022.
Convergence Research estimates that 36% of U.S. homes didn’t have a traditional pay TV subscription at the end of 2019 and expects that by 2022, 54% of households won’t have an MVPD subscription.
The company expects Q1 streaming hours will total 13.2 billion, a 49% year-over-year increase. That’s a smaller year-to-year increase than Roku reported in Q4 and a sequential decline from 16.3 billion hours for the last three months of 2019.
What Does This Actually Mean?
Simply put – coronavirus has made the streaming wars get heated sooner than expected and it’s unlikely to temper anytime soon.
- New OTTs are scrambling to move up their launches to capitalize on the eyeballs and subscription growth
- Some programmers have stopped supplying Netflix and Amazon with programming in order to build their own streaming offerings
- Many OTTs are looking for ways to expedite releasing new content
- Netflix can no longer toy with increasing pricing
Couple these points with the fact that we have no clue when we will get back to “normal” and what our new normal even looks like, and there’s a good chance people will be at home more for the foreseeable future.
With more news on social distancing in the coming weeks, and more streaming services from ViacomCBS, AT&T, Comcast and Discovery on the docket, expect this story to be a living one.
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