Australia’s subscription video on demand (SVOD) market grew 54 per cent over the past 12 months, reaching 9.1 million subscriptions at the end of June 2018, according to figures from Telsyte.

Over the same period, SVOD revenues in Australia grew substantially, up 90 per cent, reaching over $700 million at the end of the 2018 financial year.

Netflix is leading the local market, with around 3.9 million subscriptions, while Stan (jointly owned by Nine and Fairfax) is in second place with a little over 1 million.

The Telsyte Australian SVOD Market Study 2018 draws on survey data, interviews with executives from service providers, network operators, content providers, retailers, SVOD companies, and various hardware platform manufacturers and financial reports.

In total, Telsyte estimates 43 per cent of Australian households subscribed to SVOD services at the end of June 2018, an increase from around 30 per cent a year ago. This compares to around 70 per cent in the USA and 60 per cent in the UK, showing the growth opportunity within the next few years.

By 2022, Telsyte expects Australians will hold 22 million SVOD subscriptions.

The Telsyte Australian SVOD Market Study 2018

According to the analyst firm, video streaming isn’t yet a “winner takes all” market, with consumers adopting multiple subscriptions.

“Consumers are becoming comfortable with multiple subscriptions and are subscribing to different providers for exclusive content and live sports,” a spokesperson for Telsyte said.

The uptake of SVOD services is putting pressure on traditional pay TV, which is found in around one-third of Australian households (end of June 2018), a similar level to 2017.

According to Telsyte, growth in uptake of catch up and live traditional TV streaming services – sometimes called Broadcast VOD (ie 7Plus, 9Now, tenplay, ABC iView, SBS On Demand) has slowed down, with SVOD penetration on track to overtake it. Telsyte estimates there are currently 4.1 million households with SVOD services versus 5.2 million households with broadcast VOD.

The sporting codes have emerged as key power players in the video, streaming market. The AFL, NRL, and Netball (all exclusive to Telstra) showing strong demand, with usage exceeding the reported 1.5 million subscriptions in February 2018. Other popular niche services include UFC, NBA and MLB.

Based on its survey data, Telsyte estimates more than 2 million Australians watched the FIFA World Cup in June 2018 via Optus Sport despite the technical difficulties.

Previous post

Open Banking: Consumers still trust banks more than startups with their financial data

Next post

Maintaining credibility as customer experience custodians

Join the digital transformation discussion and sign up for the Which-50 Irregular Insights newsletter.