United States OTT Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Market Overview

The United States OTT Market is expected to register a CAGR of approximately 11.22% in terms of revenue and approximately 2.25% in terms of subscribers over the forecast period (2021-2026). The United States is one of the largest OTT markets in the world.

• The high penetration of smart devices, like smart TV and smartphone, growing demand for VOD content, and a high rate of per-user payment are some of the major factors driving the country's OTT market. Also, most of the top global OTT vendors, like Netflix and Amazon, are US-based, which further provides an advantage to the regional market.
• The increasing gravitation toward OTT content simultaneously frees US citizens from cables, geographic restrictions, and broadcast schedules and fundamentally changes the way video is sold, produced, and consumed. Increasing adoption, thus, has been attributable to the narrow genre choices, packages flexibility, wider device availability, internet penetration, and overall lower costs. Netflix and Amazon are the most commonly subscribed OTT platforms in the country.
• The surging percentage of viewing time going to OTT video content, with increasing revenue numbers, reflects the streaming growth, is changing the country's entertainment landscape. According to the Arizona-based Limelight Networks, globally, viewers spend an average of 6.8 hours per week consuming OTT video, with the United States topping the national averages at 8.55 hours.
• The COVID-19 has increased in viewership numbers and streaming hours, and the lack of new movies in theatres also boosts OTT platforms. SVOD has boomed during the lockdown. Hybrid services such as CBS All Access and Hulu that offer an ad-supported business model witnessed a bump in advertising revenues in the initial phase. However, according to the second Future of TV survey of over 2,100 US consumers by The Trade Desk, 27% of US cable TV subscribers planned to cut their subscriptions by the end of 2021. This is in line with the shift toward OTT services during COVID-19.
• However, some costs for OTT providers also rise along with increased consumption, with services impacted to varying degrees depending on the content delivery network model employed. As the OTT viewing amount goes up, so does the OTT provider's delivery cost since CDN services are usually charged for the amount of content delivered.
• Further, besides HBO, Netflix, and other OTT Platforms, some are untrusted ones. Thousands of such platforms are unsafe for you as user are vulnerable to lose their confidential information while paying for a subscription. Also, Cybercrime can happen on platforms that ask user for the personal information, including thebank details. Even though many reputable platforms work on tightening the security, many require tweaking their security. Hence this challenegs the market growth.

Scope of the Report

Over-the-top (OTT) content is delivered over the Internet at the request and to suit the requirements of individual consumers, rather than through traditional channels such as cable, broadcast television companies, or over-the-air live TV broadcasting. The United States Over the Top (OTT) Market is Segmented by Type (SVOD, TVOD, AVOD).

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Key Market Trends

High Penetration Of Smart TV Witnesses a Significant Growth

• Streaming content in the region has been intensifying as content owners like Disney go direct to consumer and Telcos (AT&T) and OTT-only operators like Amazon, to name a few. Simultaneously, the emergence of 4K for streaming has been propelling the growth of OTT content to be made available across smart TV formats.
• In year 2020, more than 65-70% of US broadband households own at least one streaming entertainment product, and 50% own a smart TV. OTT players such as Netflix, Disney, NFL, and NBC have been investing in creating OTT TV apps to bring their videos directly to consumers. With 40% of US homes already using a smart device to stream content, the percentage of smart TV penetration has significantly gone up. Netflix and Amazon are the most commonly subscribed OTT platforms in the country. 
• According to the Arizona-based Limelight Networks, in 2020, globally, the average number of SVoD (subscription video on demand) subscriptions per viewer was 1.5, with the United States in the lead at 2.2. Further, the rising demand for customized content led to significant adoption rates of OTT platforms.
• Current market success has been dependent upon partnerships, further exemplified by the numerous broadcaster joint ventures launched in 2020. Also, developments in traditional pay-TV services and virtual pay-TV services inclusive as a mix of broadcast and cable TV networks have been influencing the growth of OTT in the region.
• More recently, with the COVID-19 outbreak and nation-wide lockdowns, the hours spent on TV have been rising. This entails a positive growth outlook on a near-term basis. Whereas on the vendor front, Viacom is a significant vendor to be offering a direct-to-consumer (D2C) service on the back of Pluto TV, the USUS free streaming service which the company bought recently.

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