Streaming services that provide ad-supported video on demand services along with traditional subscription-based services will dominate the streaming landscape over the next five years according to a new report from Digital TV Research.
The researcher predicts that global SVOD subscriptions will increase by 428 million between 2022 and 2028 to reach 1.76 billion, “showing that there is still plenty of growth left,” it said.
With Netflix’s introduction of its lower-tier cost ad-supported streaming service launched last month, two of the most dominant streaming services—Netflix and Disney+—both now offer hybrid AVOD-SVOD services and are expected to continue that dominance through 2028, Digital TV Research said, adding that viewers that subscribe to such hybrid AVOD-SVOD subscriptions will comprise the majority of their subscription bases in five years.
“We estimate that Netflix will provide its hybrid AVOD-SVOD tier in 85 countries by 2028, with Disney+ in 91 countries, HBO in 55 and Paramount+ in 56,” said Simon Murray, Principal Analyst at Digital TV Research. “These include pan-regional services in Spanish-speaking Latin America and also in the Arabic-speaking countries.”
These four platforms collectively will have 372 million hybrid AVOD-SVOD subscribers by 2028—or 56% of their total subscriber base.
Given that Disney+ subscribers in most markets are expected to convert automatically to the hybrid AVOD-SVOD tier, the platform will have 206 million subs to this tier by 2028—or 88% of its total. At the other end of the scale, 24% of Netflix’s total subscribers will pay for the hybrid AVOD-SVOD tier by 2028—or 63 million.
Murray continued: “Netflix has a large base of SVOD-only subscribers. Most of these subscribers will remain on these plans, despite the AVOD-SVOD tier being considerably cheaper. The hybrid tier will appeal most to developing countries where disposable incomes are lower. The hybrid tier will also be attractive to new subscribers that do not have legacy SVOD-only subscriptions.”
