By 2022, viewers are expected to spend more hours watching linear streaming over-the-top (OTT) video than traditional broadcast television, according to a recent study by Level 3 Communications.
Surveying nearly 500 media professionals, the study found that more than two-thirds believe traditional TV will be in serious decline within five years. About half of respondents predicted OTT revenue growth of 30% to 50% year-over-year for 2017.
Roughly 70% of those surveyed said they already offer OTT services either globally or across at least one region. About half reported using multiple content delivery networks (CDNs), a figure that represents a 40% increase compared with the previous year.
Respondents are placing significant emphasis on improved picture quality, particularly higher frame rates (HFR) and high dynamic range (HDR). Approximately half said they are offering—or plan to offer—both HFR and HDR, while an additional 20% are concentrating exclusively on HFR delivery. The study also highlights that the maturity level of OTT providers influences the types of content they prioritize: less mature providers tend to focus on live events and video-on-demand, while more established providers favor live-linear OTT now or plan to introduce it within the next two years.
In the United States, where more than half of homes with Wi-Fi access at least one OTT service, Netflix remains the market leader, though competitors are narrowing the gap. According to comScore data cited in the study, Netflix reached 75% of OTT households in December 2016. YouTube also commands a substantial footprint, with viewership in 53% of OTT homes. In terms of engagement, Netflix ranked second with an average of 28 hours viewed per household. Amazon Video is another strong contender, growing through Amazon Prime and the Fire TV ecosystem.