Follow us

+441158386757

GO UP
video streaming services

Video streaming overtakes traditional pay TV in subscriber base

In a significant shift in the entertainment industry, the global subscription video on demand (SVoD) user base has reached 1.5 billion in 2022, surpassing the number of traditional pay TV subscribers for the first time, according to a report by GlobalData, a leading data and analytics company. Video Streaming vs Pay TV Subscribers

SIM card e SIM shop

The Rise of SVoD Video Streaming vs Pay TV Subscribers

GlobalData‘s latest report, ‘Video Streaming – Thematic Intelligence’, reveals that the global market for SVoD services, where viewers pay a monthly fee to access a library of content, was worth $103 billion in 2022. The market is projected to expand to $155 billion by 2027, registering a compound annual growth rate (CAGR) of 8.5% between 2022 and 2027.

In contrast, revenue from traditional pay TV services, which include cable TV, satellite TV, and terrestrial TV, is expected to decline from $218 billion in 2022 to $194 billion by 2027. This shift in market dynamics is primarily attributable to the cord-cutting trend as consumers transition from traditional cable, satellite, and terrestrial TV to SVoD platforms.

The Impact of Changing Viewing Habits

Rupantar Guha, Principal Analyst at GlobalData’s Thematic Intelligence team, notes that while the video streaming industry enjoyed strong growth during the pandemic, it has faced challenges in the post-pandemic period. These challenges include a shift in viewing habits, rising inflation in several markets, and subscription fatigue, where consumers feel overwhelmed by the number of subscription services they manage.

These factors led Netflix, a key player in the SVoD market, to lose subscribers for the first time in a decade in the first quarter of 2022. Despite this, the number of video streaming subscribers continues to rise while the pay-TV market stagnates. Between 2018 and 2022, global SVoD subscriber volume expanded at a CAGR of 30%, compared to 4% for pay TV subscriptions.

The Content Wars and the Future of SVoD

The push for exclusivity on SVoD platforms has intensified the content wars, with video streaming companies spending substantial amounts on content. For instance, Disney spent $33 billion in 2022 alone, over five times the BBC’s entire $6 billion budget.

However, Guha suggests that the industry is under pressure to spend heavily to retain consumers, and subscription-based streaming platforms have started shifting towards a hybrid model incorporating advertising-based video on demand (AVoD) or free ad-supported TV (FAST) to attract cost-conscious subscribers. This shift, however, is unlikely to balance their books, and the most likely outcome is more industry consolidation.

The most popularSVoD services globally and in the U.S. include:

  1. Netflix: With a penetration rate of 78 percent in the U.S. and 277 million subscribers expected by 2028, Netflix is the leading SVoD service. It is known for its vast library of content and original programming.
  2. Amazon Prime Video: This service is the second most used in the U.S. It offers a mix of movies, TV shows, and a growing number of original series.
  3. Disney+: Disney’s streaming service has quickly gained popularity due to its exclusive access to Disney, Pixar, Marvel, Star Wars, and National Geographic content.
  4. Hulu: According to some reports, Hulu is the most popular subscription streaming video service in the United States. It offers a variety of TV shows and movies, including original content and live TV options.
  5. Apple TV+ is Apple Inc.’s subscription-based streaming service that provides original ad-free content, including series, films, documentaries, and kid’s programming, across various genres and languages, available for viewing both online and offline.
  6. Crunchyroll and Funimation (Sony Group): These platforms are popular for their extensive libraries of anime content. Crunchyroll has 10.7 million subscribers, and Funimation has 2.5 million.

Video Streaming vs Pay TV Subscribers

Enjoyed this? Let your friends know!

Driven by wanderlust and a passion for tech, Sandra is the creative force behind Alertify. Love for exploration and discovery is what sparked the idea for Alertify, a product that likely combines Sandra’s technological expertise with the desire to simplify or enhance travel experiences in some way.