15 / December / 2020

The year after 2020: what to expect?

A year ago, we wrote a newsletter describing our vision of 2020. And then, everything changed drastically in most unexpected way. Interestingly, points we described resulted truthful: it was the time of OTT, mobile viewing was on top, audio content is mostly dwelling within streaming sphere as well as business! So, summing up and closing this year, we let ourselves think on about the future of streaming and OTT.

The year after 2020: what to expect?

In 2020 video streaming has increased popularity and is expected to account for 82% of all internet traffic by 2022. The real breakthrough happened during lockdown. Billions of people stayed in their homes and searched for possible ways of being entertained – the popularity of streaming services couldn’t help but break the roof.

Streaming content through various applications, gaming consoles, and multimedia devices like Roku or Apple TV makes connected TV a compelling media moving forwards. The global OTT streaming market has grown from $104.11 billion in 2019 to $161.37 billion in 2020 at an astonishing compound annual growth rate of 55.0%. 

So, what is next?

Streaming Competes Cinemas: just few days ago Warner Bros. announced that next seventeen movies will arrive in theaters and on HBO Max simultaneously. This year we almost didn't discuss streaming wars, but rumors were circulating about new way of distributing films. And now it is official.

Combating Piracy is one of the trends changing the industry. An increasing share of piracy and illegal streaming becomes an issue limiting the growth of the OTT market. In 2019, the illegal sale of video content cost the industry $9.1 billion, analysts predict that this amount could hit $12.5 billion by 2024. 

Audio Streaming: the pandemic has become a force to change a lot in live streaming. The WHO is on TikTok, John Legend, and Chris Martin’s free live concerts, celebrities’ reading books live-streamed, and many more examples – all prove that further transformation is coming up.

CTV/OTT Popularity: more and more vloggers, content aggregators, and resellers are considering moving beyond Youtube and TikTok. It’s expected that the OTT/CTV environment will show the highest market growth rates and become dominant in the ad tech market in 2021 and beyond, which explains the deep adoption levels of advertising and publishing platforms.

Forecasts for Advertisers and Publishers: ad budgets spent on streaming video are predicted to surge by 31% in 2020. Hulu experienced a rise of 23% in 2020, according to eMarketer, while ad spending on Roku is growing by up to 45% this year. This makes the CTV/OTT ecosystem perfect for both advertisers and publishers.

Advertising is shifting towards a hyper-personalized approach with no place for one-size-fits-all commercials. The era of personalization and transparency is already here. Hence, there’s a high necessity for analytical and attribution software development.

Perspective ad formats are now fewer ads per episode, and «non-disruptive ad formats» such as «pause ads» are currently being tested. Streaming video is becoming more interactive. In the future, viewers will request more information about a product or service as well as purchase it without switching devices.

Consumers worldwide are forgetting about traditional TV in favor of over-the-top video services. The number of cord-cutters is climbing, especially in the pandemic era. The advertising possibilities of this brave new world are immense, from adopting personalized approaches to considering attribution software and innovative ad formats.