According to a recent study by research firm Ovum, the company predicts that Amazon will overtake Netflix to generate more Over-the-Top (OTT) video revenue in 2018 owing to its multiple pricing options.
Ovum said that Amazon’s combination of subscription plans, digital rentals, electronic sell-through (EST), and TV app bundles will generate a combined revenue of $5.8 billion coming from video content in 2018. On the other hand, Ovum expects the current market leader Netflix to generate a VOD revenue of $5.3 billion, next year.
An excerpt from Ovum’s report reads, “Arguably, the e-commerce giant is ‘cheating,’ as Ovum’s estimates count fees from Amazon’s ever-growing Prime bundle. But maybe that’s the point. Rules are meant to be broken and Amazon is the most daring offender.”
The report also suggests that Netflix won’t have a majority of OTT video subscribers in at least 19 countries by the end of 2018 and local providers will lead in various markets such as Ipla in Poland, Showmax in South Africa, and Iflix in Indonesia.
Ovum expects Netflix, Amazon, YouTube and other online services to account for 18% of the aggregate paid and ad-supported TV and video revenues in 2018, and a growth of 60%.
The report also predicted that the US OTT market will grow by an astonishing 98%, over the current year.