Over The Top (OTT) Market
Publication Month: Jun 2017 | Report Code: TIPTE100000146 | No. of Pages: 179 | Category: Technology, Media and Telecommunications | Status: Published
The growth of the over the top (OTT) market is attributed to the gradual shift of user towards OTT service over tradition pay-tv subscription with growing use of smart phones and other mobile devices. The telecom industry is going through changing technology environment continuously. Growing preference of customer towards OTT service over tradition TV is due to many reasons, mainly because of the number of pricing and viewing options offered. They are no longer bound to stingy, pricey contracts with limited options to choose from.
Currently, OTT service is used by more than 60% of the global population and is growing rapidly because of its advantages over the telecom service such as multi-devices access, low price, and richer functionality. There has been a sharp rise in OTT user subscription and decline in the Pay-TV service in last 5 years. Netflix and Hulu have grown at about 30% per year since 2010, reaching above 120 Mn (with 89 Mn for Netflix and 30 Mn for Hulu) subscribers globally by 2016, whereas Pay-TV total subscriptions have remained stagnant to around 100 Mn subscribers, with penetration decreasing by about 1% each year since 2010.
The growth of OTT messaging services with use of mobile devices, and their overtaking conventional SMS messaging, is reflective of a general global over the top (OTT) market trend. As in 2015, WhatsApp had 700 Mn monthly active users across the globe with alone delivering on an average about 30 billion messages each day and this had grown to around 64 billion during April 2014.
The OTT communications market has expanded at an exponential rate during last few years, led initially by the wide-reaching success of OTT communication service such as WhatsApp, Facebook, etc. driving more and more players to the market. The availability of high speed internet has opened new avenues for OTT applications. OTT TV/Video involves distributing video or television content over the internet directly to users connected through different electronic devices.
Online content, applications and services are rapidly infusing in all segments of commerce and society and are affecting and disrupting traditional TV and communication services in different ways. Consumers are using online video instead of traditional TV, online communications platforms instead of traditional telephone services, and are downloading films and music which were earlier available only on physical media. The process of advertising and searching for services is increasingly shifting online. These changes have come about because broadband connectivity provides instant access to a global network of services and applications, enabling equipment manufacturers, applications providers and customers to bypass the services offered by traditional network operators and to cross national boundaries, thus obtaining multiple new routes to market.
Based on content type, the over the top (OTT) market is bifurcated into VoIP, Text & Image, Video. The video segment held a larger market share in 2016.
Based on platform, the over the top (OTT) market is segmented into smart devices, gaming consoles, set top box and laptop, tablet & desktop. The smart devices segment accounted for the largest share in 2016.
Based on revenue model, the over the top (OTT) market is segmented into digital advertisement, subscription, rentals, and others. The digital advertising segment accounted for the largest share in 2016.
Players operating in the over the top (OTT) market are mainly focused on the development of advanced and efficient products.