Subscriptions to on-demand services will reach 2 billion by 2025 according to Juniper Research, a 65 per cent increase from the end of 2020.
According to the analysts, the driving force will be traditional broadcasters who are moving their focus towards BVoD and on-demand, and away from linear.
They predict broadcasters will move towards hybrid services, a combination of subscription- and advertising-supported monetisation, such as All4+ and ITV Hub+, which offer tiered services that still generate subscription revenue but show advertisements in lower-priced bands in order to keep end user prices down. Juniper Research anticipates that these services will account for $1.4 billion in advertising spend in 2025.
The analyst’s report notes that, as subscription services become increasingly prominent, particularly in the US, different models will be needed to combat subscription fatigue. The report estimates that in 2020 there was an average of four SVoD subscriptions per household in the US, but with growth slowing significantly from 2021.
“Thanks to this high level of market saturation, streaming providers need to keep their offerings competitive to retain subscribers”, said research co-author Nick Hunt. “Hybrid monetisation is one way that VoD providers can keep their offerings low-cost, and therefore less likely to be dropped.”