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at NAB, Booth W3157

OTT In 2025 - A Promising Future

By The Zype Team on July 05, 2021

The coronavirus pandemic has taught us that life is unpredictable. There's no certainty as to what will happen in the future, and yet, one thing is certain, as Juniper Research reports— OTT subscriptions will reach two billion by the end of 2025. This amounts to a value of around USD 194.2 billion, almost 13.87% more than its estimated value of USD 85.16 billion in 2019.

This growth will be fueled primarily by traditional broadcasters, who are increasingly turning to hybrid models for monetization while competing with platforms like Netflix, Hulu, and Amazon Prime. This hybrid model consists of a combination of subscription services, as well as advertisement revenues for lower price-band users. Some big names that have adopted this model include CBS access and NBC's Peacock. 

Factors Contributing Towards The Growth Of OTT

Mobile data has become one of the key contributors to the rise of OTT. Cheap data plans and the convenience of accessing content from anywhere have made OTT players the go-to platforms for all kinds of content needs. According to Ericsson, mobile data traffic grew by 68% for the third quarter of 2019.

A report published by the World Advertising Research Center states that by 2025, over 1.3 billion people will have access to smartphones. Internet plans will continue to become cheaper, in order to encourage greater data consumption. With cord-cutting on the rise, people will continue to turn to OTT for their entertainment, news, sports, and other requirements. 

The increase in data consumption is not enough to keep the OTT industry afloat. More and more platforms are realizing this and coming up with their own productions and original content, in direct competition to traditional pay-TV. Newcomers are getting an alternative platform to showcase their talent, which is resulting in high-quality shows, keeping viewers hooked and wanting more. 

Sports have been a big part of TV viewing for decades. And OTT platforms have taken advantage of that. Most sporting events can now be easily live-streamed on these platforms, and are also available to watch later. In fact, companies like "The Future Of Sports Entertainment" have committed 15% of their operating budget towards developing their OTT stack. Since over two-thirds of the consumers in the U.S. are willing to pay up to $39 on sports content on a monthly basis, it makes sense for companies to invest in this vertical.

Advertising Shift Towards OTT By 2025

Advertisers are following viewers from the traditional platforms on to OTT. By 2025, it's estimated that advertising spends on OTT will reach $2.37 billion, up from the current spending of around $990 million.

Linear TV still enjoys a majority share of the advertising spends, but as more people are ditching their set-top boxes and satellite cable TV connections, so are the advertisers. In a survey conducted in a webinar by BIA - "All Eyes on OTT—Breakout Media Category in 2021", 41% of the respondents said that they increased their ad spends on OTT platforms, as compared to 26% who increased their ad spends on linear TV. 

OTT In 2025- A Promising Future

OTT is the way forward. With everything moving online these days, it's unlikely that the traditional methods of television viewing will continue to exist after a few years. The OTT industry is constantly evolving and players are constantly adapting to accommodate these rapid changes. Technological developments that used to take decades now happen in a span of months. In this fast-paced, ever-changing world of technology, you wouldn't want to be left behind.

If you're looking to create your own OTT platform, MAZ is here to help. Contact us to get started with your OTT platform.

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