The pay TV services market, including cable TV, satellite TV, telecoms TV and over-the-top (OTT) video, rose 7 percent to $237 billion in 2014, said IHS.
Global pay TV subscribers increased 5 percent to nearly 800 million in 2014 – fueled by the OTT pay TV segment.
OTT pay TV services will have the highest compound annual growth rate (CAGR) of any pay TV service during 2014 to 2019, said the report.
Cable pay TV revenue growth slowed to 1.8 percent in 2014 — due to sluggish subscriber growth in North America. In North America, net video subscribers are declining around 1 to 3 percent annually, IHS said.
The report said service providers are expanding market presence by offering their own OTT video services, primarily as apps on tablets and third-party OTT media servers in pay TV markets.
Dish Networks, the second-largest satellite provider in the US, is offering an OTT video service called Sling TV.
“The net result of these offerings will be slower revenue growth globally as OTT services carry a lower ARPU,” said Jeff Heynen, research director for broadband access and pay TV at IHS.
Pay TV providers are marketing bundles of 10 to 30 channels in affordable packages. Verizon has introduced multiple bundles of channels that subscribers can add on top of their base channels to create a custom channel lineup.