A new report published today by leading industry analyst & advisory group Media Partners Asia estimates that Australia’s online video industry will generate US$2.9 billion in revenue in 2020, including advertising & subscription revenue. Over the next five years, MPA expects the online video sector to grow at 13% CAGR to reach US$5.3 billion.
According to MPA, YouTube, Netflix, Disney+ and Amazon Prime Video will have an estimated 65% share of total revenues in 2020. The most significant local player is Nine Entertainment, which owns and operates two OTT platforms – 9Now and Stan which are expected to have ~9% of total online video revenues in 2020.
SVOD continues to grow rapidly, with revenues climbing an estimated 32% in 2020 to US$1.4 billion. By year-end 2020, Netflix will continue to lead the market with 6.1 million subs and ~US$710 million in revenues, driven by the popularity of its movies, series, kids, and documentaries.
Nine’s Stan is the second-largest player with 2.3 million subscribers while Disney+ and Amazon Prime Video come third with 1.8 million subscribers each. Another key player is Foxtel with 1.4 million OTT subscribers through its sports (Kayo) and entertainment (Binge and Foxtel Now) platforms. MPA projects the SVOD market to reach US$2.9 billion by 2025, a 15% CAGR from 2020.
“Australia’s online video sector is larger than either the free and pay-TV sectors, driven by the increasing availability and scaled consumption of premium entertainment and sports,” said MPA executive director Vivek Couto.
“Global media platforms have also grown with relative ease in the English-speaking market. We expect subscriber growth to decelerate in the future as the SVOD market is maturing though pricing power will increase as Netflix and Stan see more subscribers moving up to higher-priced tier and Disney+ launches a new service under the Star brand. New market entrants include the Viacom CBS-owned Paramount+, which is expected to launch in 1H 2021, and longer-term potentially Peacock, the freemium service operated by NBCUniversal.”
Online video will account for 23% of total digital ad spend in 2020. YouTube dominates with more than 60% of total AVOD revenues. BVOD platforms, comprised of 9Now, 7plus, 10play, and SBS On Demand, will close 2020 with an 11% share of AVOD revenues. Online video advertising is expected to expand at a CAGR of 11% over 2020-25 to reach US$2.4 billion by 2025.
The report is part of MPA’s Asia Pacific Online Video & Broadband Distribution series which provides detailed analysis of Subscribers, Revenues, Distribution Partnerships, Content Investment & Regulatory Dynamics in 14 markets across Asia Pacific.