Market Trends of Video-on-Demand Industry
Surge in Mobile-based Internet Users to Drive the Market
- The popularity of binge-watching on streaming platforms enhanced the customer's viewing experience. Mobile devices have played a key role in enriching the experience. They provide a much-needed viewing experience with a kind of convenience. Further, the continuous integration of various contents across mobile devices with high-speed internet enabled the users to watch the content anywhere and anytime.
- Factors such as increasing access to the internet and widespread usage of mobile devices helped customers stay up-to-date with the digital world without having to wait. Hence, instant satisfaction evolved as a powerful force in the consumer world, with users adopting mobile devices like smartphones, tablets, and PCs.
- Data-capable devices and high-bandwidth applications like gaming and video streaming are the main drivers of exponential growth in mobile data traffic. According to the GSMA Report 2022, more than 55% of people worldwide used mobile internet. Around 4.3 billion people were using mobile internet by the end of 2021, an increase of about 300 million since the end of 2020. People in low- and middle-income nations (LMICs) have largely been responsible for the growth in the use of mobile internet. As a result, for the first time, mobile internet is being used by half of the population in LMICs.
- Further, Erricson expects that there will be 2.6 billion 5G subscriptions, covering up to 65% of the world's population and generating 45% of the world's total mobile data traffic by 2025. Another report published by the World Advertising Research Centre (WARC), based on data from mobile trade body GSMA, indicated that over 1.3 billion people are anticipated to access the internet via smartphone and PC by 2025.
- The growth of mobile-based internet users is also attributed to the operators' rising adoption of 5G networks due to the consumption of content and related services, which requires 4G LTE resources. Countries like India and China have the highest mobile internet monthly usage. Attractive data plans offered by service providers and millennials' changing video viewing habits drive monthly user growth.
- As a result, both the growing number of smartphone subscriptions and the need for more data per subscription, which in turn leads to increased viewing of video content, are driving factors in internet traffic growth.
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North America to Hold the Largest Market Share
- The region comprises the United States and Canada. The United States is the largest economy in the world and has been a significant market for VoD in the North American region. Flexibility, comfort, and content personalisation, as well as the availability of diverse content and the volume of content, have largely driven the adoption of VoD services.
- According to nScreenMedia, the video streaming market in the country has grown into a USD 16 billion industry over the last nine years. The transactional and rental video markets have significantly impacted such growth.
- With smartphone transmission speeds increasing dramatically, the country is witnessing an early transition from 4G to 5G. With the increased speeds of 5G, higher-resolution videos are expected to make consumers' experiences more memorable. Such experiences drive consumers to significantly adopt digital content.
- Amid the COVID-19 pandemic, a major share of the population was staying at home to stop the spread of the virus. Due to this, a number of content producers are selecting video streaming platforms to cope with theater closures.
- For instance, the American Forces Network (AFN) launched its new streaming service, AFN Now, in November 2022. The AFN Now app allows military members, families, and retirees who are stationed abroad to watch top-rated AFN television shows whenever and wherever they want on the regular devices they use. Authorized viewers are invited to download the new video-on-demand and live-streaming app straight away by the Defence Media Activity (DMA).
- The demand for VoD services in Canada finds exciting growth opportunities owing to various factors that include increased mobility trends in Canada, the increasing proliferation of the internet, the rise of online streaming services, and an unprecedented alliance among content producers and streaming partners.
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