This New Report Shows OTT Isn’t Killing Cable … Yet

Projected over-the-top revenue falls short by billions of dollars

Revenue from OTT isn't projected to catch up with cable anytime soon. Getty Images
Headshot of Sara Jerde

TV viewing habits might be changing, but a new study shows that projected revenue from over-the-top (OTT) devices won’t come anywhere close to matching the billions of dollars in projected revenue from cable, satellite and telco TV in the years to come.

OTT revenue, based on 55 OTT providers led by Netflix, grew 41 percent in 2017 to $11.9 billion, according to findings by Convergence Research.

The group forecasted that figure to increase to $16.6 billion for 2018 and $27.6 billion for 2020.

That’s still billions of dollars away from the projected revenue from cable, satellite and TV.

In 2017, revenue among them only grew 1 percent to $107.6 billion. But the research group still projected revenue to reach $107.4 billion for 2018, and $106.9 billion for 2020.

That’s more than a $79 billion difference.

Here’s what else the research group found:

  • OTT subscriber households will far surpass TV subscribers in 2020, however U.S. TV subscriber average revenue per user (ARPU) will be four times U.S. OTT subscriber household ARPU, down from six times in 2017.
  • 2017 saw a decline of 3.66 million U.S. TV subscribers and they forecast a decline of 3.72 million TV subscribers for 2018
  • Broadcast & Cable Network Online TV advertising represented 5.2 percent of 2017 U.S. TV advertising revenue and forecast 5.6 percent for 2018

@SaraJerde Sara Jerde is publishing editor at Adweek, where she covers traditional and digital publishers’ business models. She also oversees political coverage ahead of the 2020 election.