Subscriptions to OTT services will reach 2 billion worldwide by 2025

The main driver of this growth will be traditional broadcasters, who are increasingly turning to streaming services to expand their reach.

A new report from Juniper Research predicts that there will be almost 2 billion active subscriptions to video on demand services in 2025, which would mean a 65% increase compared to the end of 2020. The principal motor of this growth will be traditional broadcasters, which are increasingly turning to streaming services to expand their reach and compete with online video giants like Netflix and Amazon Prime Video.

The new research, OTT TV & Video Streaming: Evolving Trends, Future Strategies & Market Forecasts 2020-2025 Research, notes that traditional broadcasters are turning to hybrid services, a combination of subscription and advertising monetization, such as NBC's Peacock and CBS's All Access, which offer tiered services that continue to generate subscription revenue but show ads in lower price bands to keep prices low for the end user. Juniper Research anticipates that these services will account for $1.4 billion in advertising spending in 2025.

The report notes that as subscription services become more important, especially in the United States, there will be a need for different models to combat subscription fatigue. The report estimates that in 2020 there were an average of four SVOD subscriptions per household in the US, but with growth slowing significantly from 2021 onwards.

Nick Hunt, co-author of the report, states that "thanks to this high level of market saturation, streaming providers need to keep their offers competitive to retain subscribers. Hybrid monetization is a way for VOD providers to keep their offers low-cost and therefore less likely to be abandoned."

The report shows that more than 70% of streaming video sessions in the next five years will occur on smartphones, thanks to the emergence of social videos on platforms such as TikTok. However, these do not produce a high number of advertising spaces per video viewed, meaning that smartphone advertising spending will only grow at an average rate of 2% each year over the forecast period.