An over-the-top (OTT) media service is a media service put forward directly to viewers via the Internet. The term is most correspondent with subscription-based video-on-demand (SVoD) services that offer access to film and television content. Over-the-top services are generally accessed via websites on personal computers, as well as via apps on mobile devices (such as smartphones and tablets), digital media players (including video game consoles), or televisions with integrated Smart TV platforms.
How does OTT differ from traditional TV?
First and foremost, the thing that distinguishes OTT platforms from traditional TV is the way/how the content is delivered. OTT platforms provide direct service to the users by using the internet of the audience. On the contrary, the traditional TV channel requires users to have a cable or satellite dish connection to receive the broadcast feed. Additionally, OTT platforms or services provide users with the option to pay for the content they want to watch instead of paying for everything that they might not be interested in. Besides this, in the case of traditional TV, users have very limited or no flexibility. Anytime and anywhere is the standard in today's digital era. People don't tend to wait; they want everything instantly. OTT caters to the instant gratification needs of viewers by granting them access to the content at any time of the day from anywhere.
The global OTT market size was valued at $121.61 billion in 2019 and is projected to reach $1,039.03 billion by 2027, growing at a CAGR of 29.4% from 2020 to 2027. In the OTT Video segment, the number of users is expected to amount to 3,382.6m users by 2026.
Major players in the OTT streaming market are Facebook, Netflix, Amazon, Microsoft, Google, Apple, Hulu, Tencent, Rakuten, and YouTube. This is nearly double the amount of revenue in 2020, which was $106 billion. Netflix users worldwide watched 452,000 hours of content in 2021.
Of all the revenue made in the OTT market:
• 51.58% comes from advertising video-on-demand (AVOD)
• 40.16% from subscription video-on-demand (SVOD)
• 5.1% from pay-per-view, known as transactional video-on-demand (TVOD)
• 3.16% from Video Downloads (EST) (Statista)
• Even though advertising generates 51% of the total revenue in the OTT market
Across the globe, 770 million people buy an SVOD service; that’s a nearly 40% increase from the year before.
The leading markets for OTT video services in Asia-Pacific are the Philippines, Indonesia, and Australia.
The Asia-Pacific region will increase OTT TV and movie revenue by 90% to $54bn by 2026.
By 2026, Latin America will have 116 million subscribers to OTT streaming platforms, with Brazil and Mexico being the leading markets for distributors.
Over the past few decades, the OTT industry has exceptionally evolved. The OTT industry has compelled traditional pay TV to change its strategies. OTT platforms have a great future. The acceptance and utilization of OTT platforms will only grow when 5G services are launched. Increasing adoption of smart devices and greater access to high-speed internet is expected to drive the growth of the global OTT content market during the forecast period. Additionally, availability of flexibility and ease of use is expected to get moving the global OTT industry.
Thus, due to affordable subscription-based service, flexible subscription models, ease of viewing across devices/platforms, ease of payment, better choice of content, growing demand for fresh and original content, improved connectivity and lack of additional requirements, and functional user-friendly interface. Therefore, having these umpteen reasons I can say, OTT Platforms are here to stay.