OTT to surge beyond $10 billion in APAC by 2020

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Revenues for online TV and video delivered over fixed broadband networks in the Asia-Pacific region are forecast to exceed $10.1 billion in 2020, an increase of nearly 280% from the $2.68 billion recorded for the region in 2013.

The biggest dollar growth will come from advertising, a new report from U.K. researcher Digital TV Research said. Ad revenues are expected to reach $4.61 billion in 2020 from the $1.23 billion recorded in 2013, an increase of 276%. Some of that increase will be seen this year as revenues from ads in APAC are expected to grow to $1.96 billion, a 60% jump Y/Y. On its heels will be subscription revenues, expected to increase 264% to $3.49 billion from $960 million in 2013. 2014 estimates are an increase of 33% to $1.27 billion.

Percentagewise, the largest growth will be from rental/PPV and download to own (DTO) segments, Digital TV Research posits. Rentals could increase 325% to $804 million in 2020 from $189 million in 2013. The firm estimated 2014 revenues to come in at $240 million, up 27%. DTO, meanwhile, is expected to see a 321% increase to $1.28 billion from $305 million in 2013, with 2014 estimated at $388 million, a 27% bump.

Globally, the OTT region has been driven by the expansion of key players into new markets, something that’s just beginning to happen in APAC. Plus, points out DTVR, the region is seeing broadband penetration increase, even as mobile growth continues.

Not surprisingly, the region’s biggest economy, China, likely will be the biggest driver of OTT growth as well. DTVR Analyst Simon Murray estimates China will contribute $1.96 billion to the 2020 OTT total, with Japan supplying a further $1.20 billion. Combined the two make up about two-thirds of the region’s total expected growth.

Japan is expected to drive online television and video subscription revenues, contributing about $1.93 billion in revenues, 55% of the region’s total.

The number of homes paying a monthly subscription to receive SVOD packages will climb from 2.27 million in 2010 (0.3% of TV households), to 14.49 million by end-2014 (1.8%), and on to 53.41 million in 2020 (6.0%).

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