In over a decade, the digital habits of consumers have brought about a huge impact to the media and entertainment industry in ways that have not been seen before. As the dynamics of consumer behavior and consumption patterns continue to accelerate, so is the demand for subscription video-on-demand (SVoD).
With the advancements in technology and media platforms, consumers are no longer bound to the confines of their living room
In recent years, the media industry has seen SVoD services, such as Netflix and Amazon Prime, emerge as a digital staple among consumers. The idea of video viewing on the good old TV set is now but an ember as video content has become increasingly available across a wide array of devices. With the advancements in technology and media platforms, consumers are no longer bound to the confines of their living room as cheap yet premium video content is now easily accessible at a time and place of their choosing.
It is no surprise that consumer spending on SVoD services has surged, and such upswing in the growth of SVoD service subscriptions is expected to further skyrocket. A study conducted by the Digital TV Research showed that 111% of US households have an SVoD subscription by the end of 2017, which is projected to increase to a staggering 173% by 2023. Moreover, a report by Western Europe OTT TV and Video Forecasts also highlighted that SVoD subscriber base could increase by 11 million more this year, and SVoD service is projected to penetrate some 69.3% of Western European TV households by 2023. On a global perspective, the number of SVOD users is reportedly expected to rise from approximately 283 million to 411 million between 2018 and 2022.
SVoD service is projected to penetrate some 69.3% of Western European TV households by 2023
Consumers steadily veering towards SVoD services presents a conundrum for traditional media companies. In the wake of growing SVoD subscriptions is a downward trend on traditional cable TV subscriptions — an emerging movement dubbed as ‘cutting the cord’ in the US. An estimated 33 million consumers was projected to cancel their cable TV subscriptions by the end of 2018, and studies have shown that this will further accelerate to approximately 50 million people by 2021.
The appetite for more compelling and affordable video content is growing strong among consumers. SVoD services, in particular, have brought satisfaction to this appetite while empowering consumers to have better control over what they watch and how they watch it.
The era of TV evolution is now and, suffice to say, SVoD is one of the greatest catalysts.