Streaming Revenue Will Overtake Pay TV This Year, Research Firm Predicts
Ampere Analysis believes ad-supported streaming revenue will pass $9 billion in the U.S. this year, bolstered by Prime Video's new ad tier offering
The post Streaming Revenue Will Overtake Pay TV This Year, Research Firm Predicts appeared first on TheWrap.
Streaming revenue is poised to overtake pay TV subscription revenue by the third quarter of 2024, boosted by the recent uptick in ad-supported offerings, London-based research firm Ampere Analysis predicts.
“Streaming will continue to race ahead as traditional pay TV declines – with the value of pay TV in 2028 expected to fall to half the value it saw at its peak in 2017,” the firm wrote in a new analysis released Monday.
While streaming subscribers already overtook pay TV in 2016, the industry’s average revenue per user currently sits at around 1/10th of pay TV. Ampere believes that the revenue from ad supported streaming tiers will pass $9 billion in the U.S. this year, bolstered by the launch of Prime Video’s new ad offering in January.
The latest analysis comes after Ampere predicted in November that global pay TV penetration, or the number of pay TV subscriptions relative to the number of households, would record its first annual decline in 2024, led by North America and Latin America, with all regions declining in 2025.
In a statement, the firm’s senior analyst Rory Gooderick said that while ad tiers alongside an increase in crackdowns on password-sharing have been successful at reigniting growth in the streaming industry, there’s still a path forward for pay TV.
“Disney and Charter’s recent deal in the US, which gave almost 15 million Charter subscribers access to Disney+’s advertising tier, shows how the two businesses can work together to maximize streaming’s reach to domestic subscribers, and highlights the importance of traditional distribution platforms as service aggregators,” Gooderick said. “Longer term contracts and the reduction in churn makes this an attractive proposition for streamers, while control over the billing relationship also means there’s something in it for the pay TV provider too.”
The post Streaming Revenue Will Overtake Pay TV This Year, Research Firm Predicts appeared first on TheWrap.