According to a new report from Futuresource Consulting, the TV and video market in the country is on track to achieve a second consecutive year of growth, with consumer spend set to grow by 4%.
David Sidebottom, principal analyst at Futuresource Consulting said: “The Australian market is delivering a solid overall performance, but despite the continuing upsurge, its key components are experiencing wildly varying fortunes. SVoD is the country’s shining star, with our forecasts indicating a net subscriber increase of over 2 million expected in 2019 and consumer spend poised to break the AU$1 billion barrier for the first time. Netflix is expected to further increase its investments in Australia, as it seeks to maintain growth and increase ARPU. What’s more, by 2023, the number of Australia households with at least one SVoD service is set to reach 80%. That’s one of the highest levels on the planet.”
In the transactional video sector, Australian consumers continue to show a preference for entertainment ownership, with electronic sell-through of movies to own (EST) continuing to outperform transactional VoD movies. Physical media also continues to play a role and will still account for nearly two-thirds of transactional home video spend in 2019. However, the Australian home video market is moving towards a digitised majority, and transactional digital consumer spend will exceed that of physical by 2021.
Sidebottom said: “Google Play has emerged as a key player in the digital transactional home video market. It is now an important driver behind both EST and VoD growth. This, combined with better set-top box functionality for the Pay-TV VoD providers of Telstra and the rise of Fetch TV, is culminating in a strong year for transactional digital video. The increased visibility of movie purchasing on YouTube has also helped maintain healthy levels of EST movie growth, capitalising on the significant YouTube audience. Our forecasts indicate consumer spend on transactional digital video will grow by 12% this year, the strongest year of growth since 2015, when the market was considerably more embryonic.”
Pay TV in the country is undergoing a more challenging period. The report specifically cites the restructuring of Foxtel’s services towards investing more in OTT as evidence of this.
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