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Broadcasting
February 23, 2007
NVOD lingers as VOD lounges
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A recent research from Informa Telecoms & Media has revealed that in 2011, 435 million homes will take video-on-demand (VOD) or near-video-on-demand (NVOD) services, equivalent to 38 percent of the world’s TV households. These homes will generate revenues of US $11.4 billion.
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UNITED KINGDOM -- The fifth edition of Informa’s On-Demand TV report forecasts that Asia Pacific will account for 45 percent of on-demand subscribers by 2011, although significantly lower price-points mean the region generates only 12 percent of the global revenues. North America, meanwhile, will take 46 percent of revenues, from only 27 percent of subscribers.
The research has found that established methods of delivery – pay-per-view for sports and near-video-on-demand (NVOD) for staggered movie screenings via digital cable and direct-to-home (DTH)– will continue to dominate the on-demand sector for the next few years. Thereafter, true VOD, whereby subscribers can purchase programs when they want, will come more to the fore.
Adam Thomas, author of the report, said: “Until recently, the expectation was that technically superior VOD would quickly replace NVOD. But that hasn’t happened. Much of the VOD content available is free of charge and being used as a churn-reduction device. This strategy won’t last forever, but in the meantime the established NVOD business is being retained and developed while operators gradually ratchet-up the levels of paid-for VOD content. Added to this is the rise of the DVR, which dovetails nicely with a NVOD service, meaning they aren’t going anywhere for some time to come.”
Global household forecasts by region
VOD/NVOD Households (000) 2006 2011
Asia Pacific 25,737 194,246
North America 73,067 117,989
Rest of the World 54,501 122,373
Total 153,267 434,608
Source: Informa Telecoms & Media
In Europe, the UK is comfortably the on-demand leader; generating US $480 million in 2006, almost double the second ranked country (France with US $241 million). Many operators have made progress in upgrading their networks and consumers continue to embrace digital TV as well as high-speed Internet. Moreover, telcos have continued to embrace the entertainment sector via DSL and FTTH.
Global revenue forecasts by region
Revenues (US$ million) 2006 2011
Asia Pacific 290 1,418
North America 2,081 5,201
Rest of the World 1,803 4,798
Total 4,174 11,417
Source: Informa Telecoms & Media
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