Earlier this year, Tubi forecasted that free streaming audiences would grow more than paid streaming by mid-2022. Fast-forward to comScore’s new State of Streaming 2022 Report, which backs up this prediction. The comScore data shows that consumers are adopting ad-supported streaming services faster than non-advertising supported streaming services (29% vs. 21% over the last three years). comScore’s analysis uses 13 million Smart TV devices from two primary Automatic Content Recognition (ACR) service providers.
Streaming is thriving, and the industry forecasts continued growth. Even while Wall Street questions the performance of streaming brands and their less explosive growth since the pandemic, subscriptions and viewing time continue to grow.
The overall market for subscription video on demand (SVOD) is substantial. The new PwC Global Entertainment & Media Outlook 2022–2026 projects that the 2022 SVOD marketplace in the U.S will generate $25.3 billion, up 13% from last year. PwC projects this segment to reach $33.6 billion by 2026, representing a conservative growth rate of 8.5% compound annual growth rate from 2021-26.
Subscriptions per household are growing watching watched 5.4 streaming services per month as of March 2022, compared to 4.7 in March 2021. In March 2022, the “Big Five” streaming services (Netflix, YouTube, Hulu, Amazon, and Disney) became the “Big Six,” now including HBO Max. The Netflix audiences overlap with 82% of the other top six streaming services, especially Amazon (66%) and YouTube (66%).
Big 6 services
According to the PwC’s report, global SVOD subscriptions will increase by 485 million between 2021 and 2027 to reach 1.7 billion. The six US-based platforms will have 988 million paying SVOD subscribers by 2027, up from 612 million in 2021. PwC views Netflix as the revenue winner, with $34 billion by 2027, similar to Disney+, HBO Max, and Paramount+ combined.
Device market share
Connected TVs (CTV) are the largest segment of streaming devices at 137 million in 2022 compared to 114 million in 2020. However, Smart TVs are the fastest-growing segment of streaming devices, up 48% YOY from 38 million in 2020 to 56 million in 2022. While Samsung has the largest market share among Smart TV manufacturers in 2022 at 26%, it declined from its high of 31% in 2020. Other top manufacturers include Alcatel/TCL at 15% market share in 2022, down from 14% in 2020, and Vizio at 14% in 2022, flat compared to 2020.
Eight in ten (79%) of Wifi-enabled homes watch streaming content on connected TV devices. Each of these households spends approximately 122 hours per month streaming, an increase of 19% from March 2021. Of all services, Netflix captures the most hours per month watched at 43 hours, followed closely by YouTube at 39 hours and Hulu at 33 hours.
It’s essential to distinguish the terms CTV (connected TV) and OTT (over-the-top). CTV is the device that connects to or is embedded in television to stream video content. It’s the hardware – Smart TVs, gaming consoles (used to stream video content), Roku, Amazon Fire TV, and Apple TV. OTT refers to content viewed over the internet.
Diversifying audience growth
Diverse audiences now account for more than 40% of Wifi-enabled households viewing connected TV content in the U.S.
- Hispanic audiences, the largest segment of diverse homes that stream, over-index for Netflix, YouTube, FuboTV, and Sling.
- African Americans over-index for Amazon, FuboTV, YouTube, and Pluto in terms of the streaming platforms viewing days per household.
- Asians over-index for HBO Max, Hulu, YouTube, and Sling.
Analysts question how the SVOD market will continue to grow. Many believe teens and Gen Z will drive the market as short-form video platforms like TikTok move into longer-form content. Others suggest the SVOD platforms will increase as more countries gain broader internet access.
New partnerships, mergers, and more offerings will likely continue marketplace growth. The consumer needs to be front and center as competition grows to evolve an individualized and personalized user experience.