After a boom year in 2017, the European VoD market will see significant growth over the next four years, but short of the peaks of recent years, with the exception of Southern Europe, especially Italy.
Total revenues for the VoD sector in Western Europe will amount to €6.25 billion in 2018, growing at a 12 per cent CAGR and reaching €8.81 billion in 2021, according to a report from Rome-based consultancy ITMedia Consulting.
The report indicates that revenues from SVoD in Western Europe will increase steadily, with an average annual growth rate of 15 per cent, while TVoD will grow much less, decreasing in importance in the coming years. As a result, in 2021 SVoD will account for 81 per cent of total revenue, with TVoD representing the remaining 19 per cent.
The overall penetration of SVoD has now reached 43 per cent of UK households, compared to an average penetration of about 20 per cent for the whole of Western Europe.
In France, VoD continues to find new audiences, with 37 per cent of French users over the age of six accessing at least one VoD service, up 11 per cent year-on-year. However, France is lagging behind the UK and Germany, with a market penetration rate of 10.3 per cent.
In Germany, VoD has become increasingly popular, with the two largest players accounting for a 72.8 per cent market share, with Amazon having 38.7 per cent and Netflix 34.1 per cent.
Video streaming is leading to a significant drop in pay-TV subscriptions and there has been a growth of alternative platforms offering high quality original content optimised for smaller screens.
Video has increased online broadcasters’ revenue by 20 per cent, through ads within video content. At the same time, the online viewing time has increased, with the average Internet user spending almost 90 per cent more time on a website with video content.