Market Trends of US OTT Industry
High Penetration of Smart TV Witnesses Significant Growth
- Streaming content in the region has intensified as content owners like Disney go directly to consumers, telcos (AT&T), and OTT-only operators like Amazon, to name a few. Simultaneously, the emergence of 4K for streaming has propelled OTT content growth to be made available across smart TV formats.
- Consistent growth in streaming device usage, increasing internet penetration, and demand for smart TVs have provided lucrative opportunities for media companies to enter the over-the-top (OTT) industry. Several TV makers are introducing innovative smart TVs.
- For instance, in March 2023, Sony Electronics announced the 2023 BRAVIA XR TV Lineup, equipped with Cognitive Processor XR, for a home entertainment experience. The company launched a few new BRAVIA XR lines: X95L and X93L Mini LED, X90L Full Array LED, A95L QD-OLED, and A80L OLED. All models are integrated with technology to create an immersive experience for watching movies, gaming, streaming apps, and others.
- Consumer viewership is transforming in terms of content consumption. There is more growth in online consumption than traditional TV viewership. Major factors driving the market are the flexibility of subscription plans that are available at affordable prices. Consumers have grown their interest in home entertainment by using Smart TVs in their basement areas to create home theater experiences. Additionally, it allows a diversity of content genres, comfort, freedom, and time flexibility, propelling the market’s growth.
- Content producers are partnering with Netflix to feature their content exclusively on the platform. For instance, in 2023, Perry and Netflix signed a creative partnership in which Perry contributed to writing, directing, and producing feature films under a multi-year deal. According to Netflix, the number of subscribers paying for streaming platforms in the United States and Canada accounted for 82.66 million in Q1 2024, which shows the popularity of the platform. Many producers are collaborating with Netflix to generate more revenue using integrated capabilities.
Understand The Key Trends Shaping This Market
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SVoD Segment to Hold Significant Market Share
- Subscription video-on-demand (SVoD) is similar to traditional TV packages, allowing users to consume as much content as they desire at a flat monthly rate. Major services include Sky (also its subsidiary Now TV), Amazon Prime Video, Netflix, and Hulu.
- Six major US-based platforms, namely Netflix, Amazon, Disney+, Paramount+, Apple TV+, and HBO, dominate the SVoD landscape. The emergence of SVoD platforms is also helping to attract more consumers. The number of SVoD subscriptions in the United States is projected to grow significantly in the next five years.
- The SVoD segment in the US OTT market is one of the significant segments. By 2025, the country is expected to witness a dozen platforms with more than 5 million paying subscribers, revealing just how ahead the US market is compared with the rest of the world. Growth for established players such as Amazon, Netflix, and Hulu will be affected due to intense competition from younger rivals such as Disney+, Peacock, and the augmented CBS All Access.
- As per the data by Media Play, SVoD contributed USD 52.5 billion in 2023, which is expected to reach USD 54.6 billion by 2029. Major market players are offering cheaper subscription plans to attract more customers. OTT platforms featuring content diversity, flexibility, immersive experiences, and regional content offered are the major drivers that foster the market’s growth.
