Annual spending on subscription video and TV services in the US will increase to $130.3 billion in 2019 and drop to $125.7 billion by 2022, said Strategy Analytics in its Subscription Video and TV Forecast – North America.
Pay TV firms like Comcast and AT&T, including their legacy “managed” pay TV services and new internet-based services like DIRECTV NOW, will still account for more than 80 percent of total market revenues in 2022.
The share of emerging competitors like Netflix and Amazon will remain below 20 percent until beyond 2022.
Annual revenue growth for emerging players will fall to 4.4 percent by 2022.
The report analyzed the convergence of traditional pay TV services offered by firms like Comcast and AT&T with newer subscription video services from Netflix and Amazon Prime Video, as well as internet-based pay TV services like DIRECTV Now, Sling TV, YouTube TV, Hulu Live, and PlayStation Vue.
Strategy Analytics said consumer decision-making and behavior are changing as a result of this evolving marketplace.
The report suggests that video providers will improve their chances of succeeding in this complex new environment if they focus on identifying consumer needs and desired experiences, evaluate their existing products and service offers, and monitor their market performance.
Subscription video-on-demand (SVOD) brands lose the most engagement due to buffering while transactional video-on-demand (TVOD) models suffer the most negative impact to brand loyalty if delivering low-quality experiences, according to a survey by Akamai Technologies.
The research report shows negative emotions increase 16 percent while engagement decreases nearly 20 percent as a result of these poor experiences. 76 percent say they would stop using a service if issues such as buffering occurred several times.
