OTT: The evolution of media consumption by OTT streaming services

The landscape of the entertainment industry has undergone a major revolution in recent years, which is especially caused by the technological advancements and increasing penetration of streaming platforms. In the last few years, over-the-top (OTT) content services or video streaming platforms have gained considerable popularity and, therefore, have been attaining significant market growth. There is a major shift observed in consumer behaviour and preferences from the conventional Television scheduled content to streaming platform based on-demand viewing.

As a consequence, the growth of the traditional cable TV market is adversely impacted, resulting in a decline of around 3 per cent per year of the respective market within 2031. Not only the cable TV market but the theatrical business is also hampered due to the emergence of streaming platforms as audiences are getting access to films after a few months, even in a few weeks, in their home.

Factors driving the audiences to prefer OTT streaming services

On-demand viewing

The practice of viewing scheduled content on television has become past. Consumers are most likely to watch the media content as per their preferences at the exact time when they want. The emergence of streaming platforms allows audiences to watch their favourite TV shows, web series, movies and other media content at any time as per their preferences in a single setting.

Personalised recommendations

The streaming platforms often offer personalised recommendations of media content tailored to the individual’s preferences and tastes by using efficient algorithms. As a consequence, a majority of audiences are found to depend on these customised recommendations for the identification of new movies and shows in replace of the traditional ways of content discovery.

Offering of original contents

Various streaming platforms have significantly emphasised making a considerable investment in the production of original content. This facilitates the consumers to not only get access to their favourite movies and shows but also provides access to exclusively new content on subscriptions.

Mobile viewing

Due to the rising penetration of smartphones and tablets, it has become possible for viewers to watch content from anywhere, even while travelling to other places. Mobile viewing is considered a vital part as well as an exciting feature of the streaming experiences, which leads to a significant impact on the allocation of time for entertainment by consumers. 

Global exposure

Due to the global reach of streaming platforms, it has become more convenient for consumers to get access to international content. Over time, the audiences are increasingly being engaged in watching the foreign language content which leads to the expansion of their media exposure beyond their native languages. Moreover, consumers have the opportunity to enjoy ad-free services and save videos in several languages to view in the offline mode on their mobile phones at a minimal cost.

The rise of the OTT streaming

The origination of the idea of OTT streaming is linked with the emergence of the internet along with the advancement in digital technology. Prominent players such as Netflix and Hulu have realised the advantages of the internet to deliver content directly to audiences, altering the conventional distribution channels. This facilitated the initiation of a new era in the context of entertainment, in which individuals got access to controlling their viewing experiences.

Over time, with the improvement of the internet infrastructure and increased penetration of broadband globally, streaming platforms are found to be becoming more accessible towards a broad audience. The ease of accessibility of streaming content on multiple devices, starting from smartphones to smart TVs and laptops, has led to the rapid integration of streaming platform services.  

Most popular streaming platforms worldwide

Netflix

Netflix is recognised as one of the pioneers in the OTT context, which involves an extensive library of shows, movies, and original content belonging to various genres, starting from drama to documentary. There are around 278 million paid subscribers of Netflix in more than 190 countries across the world. However, some of the countries where Netflix is not available include Russia, China, North Korea, Syria and Crimea. 

Disney Plus

The entry of Disney+ into the video streaming industry has been recognised as a game changer, especially due to its access to major franchises such as Marvel and Star Wars. Apart from Europe, Disney Plus is available in Canada, the US, Australia, Japan, New Zealand, South Korea, Hong Kong, Taiwan and across Latin America. This is found to be known as Disney Plus Hotstar in India, which is positioned as one of the market leaders in streaming services.

Amazon Prime Video

This is another leading OTT platform which allows consumers to get the accessibility to a wider range of TV shows and movies. Further, the popularity of its e-commerce platforms, along with the offering of exclusive advantages for Amazon Prime members, has contributed to the increased number of subscriber members. Amazon Prime Video also offers its services in more than 200 nations and territories across the world. 

Hulu

Hulu is known for offering both live TV streaming and on-demand services to customers. The collaboration with a variety of television networks enables it to offer a wide range of content to the viewers.

The markets which are most profitable for OTT services

Table: Value of OTT market worldwide by region (in USD Billion)

There are five major regions based on which the global OTT market is divided. These are North America, Middle East and Africa, South America, Europe, and Asia-Pacific regions. Among these, the OTT market has the major dominance in North America, having the majority portion of the share. The value of the OTT market in this region was around 48.72 billion US dollars in 2021, which is forecasted to increase to 141.67 billion US dollars in 2028, showing an annual growth of 16.5 per cent.

On the other side, the Asia-Pacific region is also expected to grow at an annual growth rate of 16.9 per cent during the forecast period of 2021 to 2028. The projected value of this region is 109.23 billion US dollars in 2028, while it was 36.80 billion US dollars in 2021. Next, the European market is found to be the most valued market for the over-the-top streaming sector.

There was a market value of around 33.30 billion US dollars in Europe for the streaming industry in 2021 which has the potential to reach 95.49 billion US dollars by 2028. However, the value of the respective market in the South America and Middle East & African regions is relatively low in comparison to the other regions.

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