Disney and Apple to challenge for SVOD market share

As Disney and Apple launch Subscription Video On Demand (SVOD) services in 2019 – challenging existing players – who will dominate this rapidly expanding market?

Disney and Apple to challenge for SVOD market share
Disney and Apple to challenge for SVOD market share

SVOD continues to resonate with consumers across the globe, becoming an integral part of the video viewing lifestyle. A new SVOD report from Futuresource Consulting reveals that SVOD already reaches more than 60% of households in North America, 26% in Western Europe, 21% in Asia-Pacific and 19% in LATAM.

Disney+ launches in November

Launching in late 2019, Disney+ will be the ultimate streaming destination for movies and shows from Disney, Pixar, Marvel, Star Wars, and National Geographic. Disney+ will offer ad-free programming with a variety of original feature-length films, documentaries, live-action and animated series and short-form content, along with Disney’s library of film and television entertainment. The service will also be the exclusive streaming home for films released by The Walt Disney Studios in 2019 and beyond, including “Captain Marvel,” “Avengers: Endgame,” “Aladdin,” “Toy Story 4,” “The Lion King,” “Frozen 2,”and “Star Wars: Episode IX.”

Apple unveils Apple TV+

Apple TV+, Apple’s original video subscription service, will feature a brand new slate of programming from the likes of Oprah Winfrey, Steven Spielberg, Jennifer Aniston, Reese Witherspoon, Octavia Spencer, J.J. Abrams, Jason Momoa, M. Night Shyamalan, Jon M. Chu and more.

The new Apple TV app personalises what viewers watch across their existing apps and services and will offer suggestions for shows and movies from over 150 streaming apps, including Amazon Prime and Hulu, as well as pay-TV services such as Canal+, Charter Spectrum, DIRECTV NOW and PlayStation Vue. Optimum and Suddenlink from Altice will be added later this year.

Additionally, the Apple TV app will become the new home to the hundreds of thousands of movies and TV shows currently available for purchase or rent in the iTunes Store.

US SVOD subscriptions to reach 270 million

According to Digital TV Research, the number of SVOD subscriptions (for movies, linear channels and TV episodes - excluding other platforms such as sports services) in North America will climb by 110 million from 160 million in 2018 to 270 million in 2024. These figures are gross – many homes take more than one SVOD platform.

Digital TV Research forecasts that 77.8% of TV households (94 million) will subscribe to at least one SVOD platform by 2024. The average SVOD household will pay for 2.89 SVOD subscriptions. This compares to 70.0% of TV households (84 million) TV households subscribing to at least one SVOD platform by end-2018. The average SVOD subscriber paid for 1.91 SVOD platforms at end-2018.

Digital TV Research expects that Disney+ will have 25 million US subscribers by 2024. Apple TV+’s growth will be more modest at 8 million by 2024.

Asia Pacific OTT to generate $48 billion

Across the Asia Pacific region, OTT TV episode and movie revenues will more than double by 2024, reaching $48 billion in 2024; up from the $21 billion recorded in 2018. According to the Asia Pacific OTT TV and Video Forecasts report from Digital TV Research, the total will increase by $5 billion in 2019 alone.

China and Japan will account for 71% of the region’s total revenues by 2024. China will command a 57% share by 2024 from the 22 countries covered in the report.

Interestingly, advertising on OTT sites [AVOD] is the main source of OTT revenues. SVOD will take 39% of OTT revenues by 2024, with AVOD supplying 52%. AVOD revenues will exceed SVOD revenues in China, India and Japan. China’s AVOD revenues will reach a staggering $16.60 billion by 2024 – or two-thirds of the Asia Pacific total.

Asia Pacific SVOD revenues will climb from just under $8 billion in 2018 to $19 billion in 2024. China’s share will remain at about half of the total. India’s SVOD revenues will quadruple, but it will still be way behind the similarly-sized China.

Digital TV Research forecast 407 million SVOD subscriptions by 2024, up from 221 million in 2018. China will have 289 million SVOD subs in 2024. India and Japan will supply a further 31 million each.

Three Chinese companies will top the Asia Pacific SVOD rankings by subscribers in 2024 – two of which will have more than 100 million subs.

Are you ready for SVOD proliferation?

Rohde & Schwarz is here to support you today, and for the future, and endeavour to stay-ahead of trends to ensure our clients get innovative products that help real needs. With our next generation media storage, we can provide you with the massive scalability you’ll need to adapt to the changing industry. Discover our high-performance broadcast and media technology today.

Posted by Chris Dickinson, technology journalist and editor of the Always On blog. May 14, 2019.

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