New forecasts from GlobalData suggest that the decline of traditional pay TV video services is only going to get worse, with only 32% of U.S. homes having one in 2028. That marks a further decline from the 42% penetration rate in 2023 and a steep decline from 2009 and 2010 when pay TV penetration exceeded 85%. 

The GlobalData study explained that the subscription declines reflected the fact that more viewers will be cutting the cord and shifting over to over-the-top (OTT) streaming services. 

Complicating matters are the younger viewers who have never even subscribed to a traditional pay TV service and likely never will. In addition sports rights, which had traditionally kept some viewers in the pay TV universe, are increasingly shifting over to streaming. 

GlobalData’s latest report, “United States Pay-TV Forecast,” also predicts that the total linear U.S. pay-TV subscriptions will fall below 50 million by 2025, as viewers continue turning away from cable TV, satellite TV, and broadband-delivered IPTV subscriptions.

Meanwhile, viewers will be spending more time on ad-supported streaming video (AVOD) and free ad-supported streaming TV (FAST) services like The Roku Channel, Tubi, Peacock, and Pluto TV; virtual multichannel video programming distributors (vMVPDs) like YouTube TV, Hulu + Live TV, and Sling TV; as well as streaming video on demand (SVOD) services like Netflix and Amazon Prime Video, either with or without ads, the researchers said.

“Younger generations tend to adopt new technologies and services like video streaming, but an additional element of the cord-nevers is the emergence of the ‘generation rent’ phenomenon,” explained Jesús Romo, principal analyst at GlobalData. “Younger consumers who are priced out of the housing market and rent for longer periods may prefer more flexible entertainment options that do not require a physical installation, are generally unbundled, and allow them to cancel and resubscribe.”

Tammy Parker, principal analyst at GlobalData added that “sports programming has been the chief redeeming feature for traditional pay TV services, which is still true to a point, but streaming video providers are increasingly encroaching on that sacrosanct relationship, with certain live sports events having already migrated to streaming platforms. For example, viewers who want to watch NFL Thursday Night Football or Major League Soccer’s MLS Season Pass need to turn to Amazon Prime or Apple TV+, respectively. Disney’s expected launch of a standalone ESPN streaming service will further encourage a viewer exodus from traditional linear TV providers.”

As traditional pay TV service providers continue to lose customers, cable’s share of that shrinking market will grow in the coming years; cable is expected to control 69% of the U.S. pay TV market in 2028, up from 64% this year. 

This is largely due to the satellite pay TV providers’ more rapidly shrinking customer bases, the study found. Although U.S. cable’s subscriber rolls will shrink at a CAGR of -3% from this year through 2028, satellite-based providers will see a decline of -6% CAGR, and IPTV providers will fare even worse, with a CAGR of -12%.

“Pay TV subscription revenues are taking a hit as well," Parker concluded. "Though price increases have helped cable and satellite TV providers grow their average revenue per subscriber (ARPS), traditional pay TV revenue is on the decline. Total annual US pay TV subscription revenue is expected to plummet from $80.8 billion in 2023 to less than $63.6 billion in 2028, registering a declining CAGR of nearly -5%.”

A new report from the data and analytics company GlobalData suggests that the metaverse, a virtual world where users share experiences and interact in real-time within simulated scenarios, faces an uphill path in the next few years as limited use cases will hamper its adoption.

GlobalData’s latest report, “Metaverse – Thematic Intelligence”, argues that the metaverse market will continue to struggle with several problems, including limited understanding of the idea, unimpressed consumers, the postponement of metaverse projects by Big Tech, and concerns with privacy and security. 

Even so, the sector will see significant growth from about $48 billion in 2022 to $400 billion by 2030, the report predicted. 

“The metaverse has struggled to live up to the excessive hype that built up in 2021 and early 2022,” Rupantar Guha, principal analyst at GlobalData’s Thematic Intelligence team, said. “The theme has lost its luster due to limited use cases and the limitations of underlying technologies like blockchain, augmented reality (AR), virtual reality (VR), and digital twins. Without improvements in these technologies, the metaverse will continue to disappoint.”

The report argues that technology companies must develop user interfaces that are easily accessible, synchronize real and virtual environments, and provide safety and comfort during prolonged use. Platform providers must offer a range of content that users want to experience repeatedly. Those that stick to one content type will limit their revenue opportunities in the long run.

“The metaverse hype is primarily focused on consumer use cases, but solutions like data visualization, collaboration, and training will fuel the enterprise metaverse,” Guha concludes. “Despite skepticism around its long-term benefits, focusing on the future of work will boost adoption by large enterprises in the next five years.”

Annual revenues of U..S subscription video on demand (SVOD) services will nearly equal those of traditional pay TV in 2027, marking a critical tipping point in the ongoing decline of cable TV, IPTV, and satellite TV services as over-the-top video streaming rises to dominate the media landscape. 

That’s the conclusion of a new report from GlobalData that predicts that revenues from SVOD services such as Netflix, Amazon Prime, and Hulu will increase from nearly $47.6 billion in 2022 to $64.6 billion in 2027, recording a compound annual growth rate (CAGR) of 6.3%.

This growth will come at the expense of traditional pay TV in the US, as the research firm estimates that pay-TV revenues will plummet from $88.5 billion in 2022 to less than $65 billion in 2027, registering a negative CAGR of 6.0%. SVOD’s household penetration, having already reached a whopping 260% in 2022 thanks to households subscribing to multiple SVOD services, will jump to 312% in 2027.

Meanwhile, pay TV’s U.S. household penetration rate will slide from 47% in 2022 to 33% in 2027, with ongoing declines registering across cable TV, broadband-delivered IPTV, and direct-to-home (DTH)/satellite TV subscriptions as the ranks of “cord-cutters” and “cord-nevers” grow unabated. Young adults who have never subscribed to cable or satellite TV make up the cord-nevers, while older users who are turning away from traditional pay TV in favor of streaming services are considered "cord-cutters."

“SVOD was already on an impressive upward trajectory, but the addition of live sports programming is changing audience viewing habits even more, helping drive additional pay-TV cord-cutting and SVOD growth. Just this month, the National Football League and NBCUniversal announced that the Peacock streaming service will air the first-ever exclusive live streamed NFL postseason game in January 2024, when it presents an NFL Wild Card Playoff. Even ESPN is reportedly eyeing a standalone direct-to-consumer (DTC) streaming version of its flagship channel.”

There is some good news for traditional pay-TV service providers, as GlobalData anticipates their monthly average revenue per subscriber (ARPS) will remain strong. US pay-TV ARPS reached $113.49 in 2022 and is expected to rise to $118.34 in 2027, thanks largely to price increases by cable TV and satellite TV providers. 

Domestic SVOD providers, meanwhile, will see low, but stable ARPS over the next few years, as the sector’s monthly ARPS of $12.16 in 2022 will increase just slightly to $12.79 in 2027. SVOD price increases will be reined in due to heated competition, as well as the increased use of ad-supported tiers, plans with limited content, and monthly and temporary discounts, GlobalData says. Additionally, as inflation moderates, there should be less pressure on SVOD providers to dramatically raise prices.

“GlobalData expects Netflix to continue to dominate SVOD revenue market share, attracting about three times as much revenue as Amazon Prime, and twice as much as Hulu (SVOD only, without live TV) each year through 2027,” Parker added. 

LONDON—By the end of 2020, there will be more streaming accounts, 1.1 billion, throughout the world than there are traditional pay-TV accounts, according to data and analytics company Globaldata.

The rise of cord-cutting has been well reported, but according to GlobalData’s latest study, “Thematic Research: Internet TV,” it is not simply cost savings that are driving the move toward streaming, but also the flexibility and the range of content available through the different services.

PLUS: Legacy Pay-TV Subscriptions Continue to Decline Amid OTT's Rise

This is supported by the move of large media firms establishing their own streaming services, like Disney+, Peacock, HBO Max and Apple TV+. 

Netflix still leads the pack, according to GlobalData, but the other services are attempting to compete not only by adding to their content library, but by also improving upon their user interface.

The full report is available on GlobalData’s website. 

LONDON—Cord cutting will continue to hit the pockets of the pay-TV industry over the new few years, as new projections from GlobalData indicated that pay-TV revenue is expected to drop from $94.4 billion in 2019 to $84 billion by 2024.

This comes from a new report published by GlobalData that looks at U.S. telecom and pay-TV service revenue. However, despite the $10 billion loss of pay-TV revenue, GlobalData still projects that there will be overall growth, with total service revenue reaching $419.4 billion by 2024.

As projections stand now for the telecommunications and pay-TV industry, revenue in 2019 will reach $404.5 billion, which would represent a 0.5% decline from 2018’s results. This loss is mainly attributed to declining revenues from mobile and fixed-voice data communications. However, the compound annual growth rate of the total service revenue is expected to be 0.7%, which would get the industry to the $419 billion mark.

Mobile data is expected to be the chief driver for this growth for telecom service revenue, going from $131.2 billion in 2019 to $194.6 billion in 2024 as smartphone subscriptions increase, there’s more demand for mobile services and adoption of 5G services.

Fixed broadband is also expected to see a CAGR of 4% in the next five years thanks to the adoption of ultrafast broadband service connections.

GlobalData has more information on the report on its website.

LONDON—When 2019 closes, data and analytics company GlobalData estimates that there will be 147 million subscribers to SVoD services throughout North America. However, more than 90% of that comes from the U.S. market alone.

This was one of the key findings of GlobalData’s “OTT Video Content, Pricing and Market Opportunity in the Americas” report. With such a huge chunk of the market in the region, the U.S. is one of the most competitive SVoD markets in the world, per GlobalData. The emergence of SVoD platforms is also helping to drive consumers’ cord-cutting trends.

Building off of the estimated 147 million subscribers at the end of 2019, GlobalData forecasts a compound annual growth rate of 9% through 2023. This projection builds off not only already popular streaming services like Netflix and HBO, but also new ones that have or will be launched in the near future.

“The recent launch of new SVoD Platforms Apple TV+ and Disney+ will heat up competition in the U.S. market even further, increasing pressure not only on traditional pay-TV operators but also on incumbent SVoD platforms such as Netflix,” Eulalia Marin-Sorribes, technology analyst at GlobalData. She also cites the 2020 launch of HBO Max in the report.

The full “OTT Video Content, Pricing and Market Opportunity in the Americas” report is now available.

LONDON—By 2023, less than half of TV households in the Americas will have a pay-TV subscription, according to a new report from data and analytics company GlobalData. As cord-cutting trends continue, particularly in North America, the overall penetration of pay-TV in homes will drop from 53.2% in 2018 to 48.8% in 2023.

While the statistics represent all of the Americas, the only two countries that are actually projected to see a decline in pay-TV subscriptions is the U.S. and Canada. The U.S. alone is projected to lose more than 10 million subscriptions.

Globally, the average of homes with a pay-TV subscription as of 2018 was at 55.3%. In Central and Eastern Europe that number was at 71.2%; it was 67.4% in APAC; and Western Europe came in at 62.5%. All regions, except for APAC and the Americas, are expected to continue to grow.

“Although cord-cutting is not affecting Latin America as a region yet, we expect subscriber growth will decelerate in the coming years as customers’ appetite for on-demand content increases and new commercial platforms in the SVoD markets emerge,” said Eulalia Marin-Sorribes, a GlobalData technology analyst. “In order to slow the decline, traditional pay-TV operators are enhancing their video service proposition with OTT features are relevant content offers.”

Marin-Sorribes also notes that the emergence of 5G will increase transmission speeds that will boost opportunities for OTT providers and competition among fixed broadband and pay-TV segments, likely accelerating cord-cutting in most mature markets.

LONDON—As 5G mobile services are preparing to launch over the next few years, the emerging technology is expected to find a solid foot hole in the Americas as part of a wider increase in mobile subscriptions.

Per a new report from data and analytics company GlobalData, 5G mobile subscriptions will reach about 204 million throughout the Americas by 2023. The U.S. is projected to lead the way for the 5G market, with 5G accounting for 26.8% share of total mobile subscription in the country by 2023.

The rise in 5G will be part of a more general growth of mobile subscriptions across the Americas, per GlobalData. As of 2018, there were 1.2 billion mobile subscriptions in the region, and by 2023 that is forecasted to hit 1.5 billion with a CAGR of 4.1% over that period.

“Mobile penetration will rise from 120.8% in 2018 to 141.1% by 2023, led by a significant rise in penetration levels, in the U.S. and Canada in North America, and Brazil and Mexico in LATAM with rising M2M/IoT subscriptions,” said Leandro Agion, a GlobalData technology analyst.

While there will be a surge in 5G subscriptions, 4G is expected to still lead mobile technology for the 2018-2023 period, with its share rising from 59.6% to 70.1% over the five years. This will be driven by 4G network expansions, particularly in LATAM. In North America, however, more room will be made for 4G/5G spectrum by shutting down 3G networks.