COVID-19 pandemic: A boon for the OTT industry (OTT Platforms)
The global Coronavirus pandemic has brought things to a standstill which has impacted numerous businesses across the world. It has changed our lifestyles and also established a new normal. The time for streaming OTT platforms.
However, some industries have prospered amidst this pandemic and have shown exponential growth. The OTT media industry is among those that have had a smooth ride during the pandemic.
You will be surprised to learn about the fact that the Compounded Annual Growth Rate (CAGR) of the OTT segment is expected to reach around 19% by 2026. This is quite higher than the CAGR for this industry before the COVID-19 pandemic, which stood at 16%.
Let’s delve deeper into some other interesting growth stats related to the OTT streaming space.
Key growth metrics for the OTT industry
The nationwide shutdowns forced people to stay indoors and find alternative entertainment sources. This gave the much-needed push to the OTT video streaming industry that was already growing before the pandemic.
People realized the benefits of using OTT platforms to watch content and it became the go-to source for entertainment amidst the lockdown. Let’s take a sneak peek into some important growth stats related to the OTT industry.
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Surge in the viewer’s count
The OTT platform has seen a massive increase in the number of viewers ever since the pandemic came into existence. A recent survey found that around 98% of all US consumers have subscribed to at least one OTT service.
You will be surprised to learn that American Netflix viewers used over 9.6 GB of data every day during 2020. In India, a majority of OTT channels have seen a 30-40% spike in paid subscribers during the last year.
Growth in the viewing time span
You will be amazed to find out that over 239 billion hours were spent using video streaming applications on smartphones across the world during the fourth quarter of 2020. The number of app viewing hours showed a 69% growth since 2019.
The average British person spends around 1 hour and 16 minutes watching Netflix on a daily basis. These stats show that there was a massive increase in the viewing time span for OTT content after the pandemic.
Increase in the revenue from the OTT Platforms market
The latest predictions related to the OTT service industry showed that the revenue from advertisement sources will be over $119 billion by 2023. Over 51% of the overall revenue in the OTT space is generated from advertisements.
It is also expected that the global revenues from streamed TV and movies will reach around $159 billion by 2024. The Average Revenue Per User (ARPU) for OTT video advertising will be over $52 billion by 2025. It shows an aggregated increase of around 72% over the last five years.
Major growth drivers in the OTT space
Now that we have learnt about the exponential growth in the Over-the-Top services space, let’s dive deeper into some of the key catalysts of this growth.
High internet penetration
One of the most important factors that have led to the exponential growth of the OTT streaming business is the increased internet penetration. The accessibility and affordability of high-speed internet even in the remote parts of the world have fueled the consumption and creation of video content.
The advent of 5G cellular internet technology will further help in the growth and development of OTT platforms by improving the quality of video content being consumed by the masses. High-speed internet technology has helped many industries and governments across the world to invest in the same, making it affordable for the common public.
Increased affordability of smartphones
You will be amazed to know that over 239 billion hours were spent using streaming applications on smartphones across the world in Q4 2020. The affordability of smartphones has increased over the last decade and a major percentage of the population has access to smartphones.
People across the world are using smartphones to access OTT platforms to stream content. OTT giants like Netflix have even introduced cheap smartphone subscription models for users who only want to access the content using their phones.
Media streaming technology advances
The traditional TV media services did not adapt to the changing needs of the viewers in the age of the internet and digital media. The cable TV packages were expensive and did not provide much flexibility. This led to the creation of OTT media streaming services that relies on the internet to deliver content directly to the users. It uses technology to provide a feature-packed experience and also brings more convenience to the users.
Personalization is the key to winning in the contemporary world. Most OTT solution use AI technology to provide personalized content recommendations to the users. This helps to save a lot of time and effort spent by the users in finding relevant content that they might like. Personalization plays a key role in boosting the user experience.
Multiple monetization models
Today, there are numerous ways to monetize your online content on OTT platforms. OTT business owners are benefitting from multiple monetization methods including SVOD, TVOD, AVOD, etc. Innovative pricing models help creators to choose the most suitable model depending on their target audience and geography.
Increased demand for exclusive content
Did you know that the OTT VOD viewership has increased by over 38% during the COVID-19 pandemic period? This is quite high when compared to the growth figures for linear TV viewership which stood at 6-7% during the same period.
Viewers are hungry for fresh and new content and niche-based OTT channels are gaining popularity among the audience. Creating exclusive content based on the target audience has helped many platforms succeed in the OTT space.
In a nutshell
The OTT industry was already growing before the global COVID-19 pandemic but the pace of growth has increased during this period. The industry has seen a massive surge in the number of viewers and viewing time. The demand for exclusive content is also on the rise.
Creating a dynamic OTT platform by hiring a reliable OTT platforms provider will help you establish a sustainable business that you can bank on.
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