As OTT slows in the US, OTT jumps to the Samba rhythm.
The popularity of OTT usage is beating to the rhythm of the samba drums. As over-the-top content (OTT) is on the rise in the US and nearing saturation according to eMarketer. By 2019, 72.1% will be using OTT video services. The forecast of US OTT video service users shows that the vast majority of digital video viewers use these services. The category is near saturation, in large part because of YouTube’s commanding presence in this area, as explored in a new eMarketer report, “Q4 2015 State of Video: Monetization, Audience, Platforms and Content,” which is the fourth in an on-going series of quarterly “State of Video” reports.
The eMarketer’s Report also breakout of US OTT users by service, showing that Google’s YouTube is the most prevalent, with a more than 94% penetration rate throughout the forecast period. Youtube launched back in October 2015 a Youtube Red paid service, currently only available in the US. The service initially aimed at Monetizing music streams for the service, however it also allows users to buy video content, as well as remove all ads. In time the service will allow independent Content producers to monetise their content and users via monthly paid subscriptions.
A report Parkes Associates estimates a quarter of US OTT subscribers plan to upgrade their broadband service in the next 12 months, driving a new norm for the industry.
“Today, one-third of broadband households that own three or more connected devices state that they are likely to upgrade their broadband service in the next 12 months. These high-speed connections will enable improved experiences, encouraging consumers to spend even more time with connected entertainment” commented Director of Research Brett Sappington of Parks Associates.
This also indicates, that as growth increases, the rates of viewing devices among US connected TV users will gradually shift away from legacy technologies such as disc players and game consoles toward newer, more-portable set-top boxes and streaming sticks.
In its assessment of the way in which over-the-top has become a mainstream play, and where leisure spend trends are headed, the research firm also found that only 7% of consumers who watch video exclusively on television plan to upgrade their pay-TV service in the next 12 months. This compares with the 22% of consumers with above-average viewing on all platforms, including computers and mobile devices.
Also on the rise, are viewers in pay-TV homes who use TV everywhere services.GfK’s TV Everywhere 2015 report found that 53% of consumers in pay-TV homes have used TVE (TV Everywhere) to watch shows on a computer, mobile device, or TV set, a jump of ten percentage points compared with three years ago. It also revealed that 42% of people in pay-TV households have taken advantage of TVE offerings from signal providers, while 46% have used TV network services.
Mass availability of mobile devices were also a key the main driver of the TVE growth with monthly use having doubled since 2012 for mobile apps and websites from TV signal providers and networks alike. Viewers were found to be turning to traditional TVE websites — viewable via computers — at roughly the same rates as three years ago.
Latin America’s Growth
Latin America is poised to accelerate it’s OTT growth in 2016. Dataxis reportOTT Market in Latin America 2014–2018 identified 75 VOD OTT streaming platforms in the seven main countries of Latin America — Argentina, Brazil, Chile, Colombia, Mexico, Peru and Venezuela — of which 41.3% are local operators. Moreover, 19 other OTT platforms have been launched and subsequently cancelled in the region.
According to the report, the VOD OTT market in the seven main LATAM markets will record USD978.4 million in revenues during 2014, 53.4% will come from S-VOD, 33.7% from T-VOD and the remaining from Download-To-Own market (DTO). Dataxis forecasts that VOD OTT revenues will rise to USD3.17 billion in 2018. Brazil and Mexico will remain the largest markets — with Brazil capturing 35.3% of total revenues and Mexico 34.6%.
Brazil’s largest media conglomerate, Grupo Globo, make’s it the largest mass media group of Latin America, based out of Rio de Janeiro, Brazil with group revenue of US$16.2 billion a year.
Brazil being the main driver, services of OTT are now starting to run hot in the country, the 5 largest Internet market in the world, with an internet penetration of 60% of 200 Million habitants, giving it 119 Million connected individuals.
As OTT services have expanded in Brazil, paid TV subscription has displayed a decrease in adoption, according to recent statistics. Data from Anatel, or the Brazilian Telecommunications Agency, reveals that between December 2014 and March 2015 paid TV subscribers in the country increased 0.9%. Meanwhile, a survey by technology services and consulting company Accenture published in May 2015 discovered that 48% of Brazilians were interested in accessing multiple types of content from their Television Screens, as per a graph from Telco, a Brazilian Market Intelligence agency.
Globo recently premiered its first 4K-produced soap opera, Brazil’s Globo has prepped its first Ultra HD launch via over-the-top (OTT) video-on-demand (VOD).
Dupla Identidade became the first soap opera entirely produced in 4K to premiere on Brazil’s free-to-air (FTA) TV, and now Globo is to add it to its OTT service, Globo Play. For January, the media group is preparing the second Ultra HD TV telenovela, Ligações Perigosas, which will air both on FTA and through the OTT platform as on-demand content.
“We are continuously investing in technology, which makes us pioneers in new solutions. This platform has been developed by Globo’s team and the technological infrastructure of Globo.com,” explained Raymundo Barros, technology director, Globo.
4K title premieres look to power Globo Play, which recently launched for mobile devices and Samsung smart TVs. The platform will soon arrive on LG, Sony, Philips and Panasonic smart TVs.
Although Ultra HD is only available for subscribers with very high speed Internet connections, the Play platform has already reached the 2.5 million downloads in a month.