OTT and VOD revenues set to exceed US$30 million by 2016

Over-the-top TV and video-on-demand services from pay TV operators will deliver combined revenues of over US$30 billion (€21 billion) in five years’ time, according to IMS Research.

The research group forecasts that OTT video services will generate US$16.4 billion in 2016, while pay TV VOD services will provide another US$14.7 billion, giving a total of US$31.1 billion.

Revenue from such services will be boosted by the growing penetration of fixed connected devices and growth in bandwidth, while pay TV via the set-top will continue to deliver the majority of on-demand entertainment, he emergence of other devices including connected TV sets and games consoles will have a significant impact on on-demand viewing, according to IMS’s Over-the-Top Video – Service Delivery & Business Models – 2011 edition report.

IMS Research forecasts that 5.9 billion pay OTT transactions (including subscription-based transactions) will be initiated via fixed in-home devices in 2016, up from about 563 million this year, compared with estimated 12.9 billion pay VOD and OTT transactions via set-top boxes by 2016, up from about 5.2 billion this year.

However, traditional pay TV revenues, estimated at US$244 billion in 2010, will continue to provide by far the greatest proportion of video revenues by comparison with OTT and VOD services, according to IMS Research.