Fixed broadband access continues to climb, reaching 0.6bn homes globally in 2012, but growth is beginning to slow, being held back by structural issues in many emerging markets. Nonetheless, IHS expects there to be 2.3bn people globally with home broadband by the end of 2017–up from 1.8bn at the end of 2012.
The increases in broadband access in recent years have been accompanied by growth in online video, with the global market reaching roughly $12bn in turnover in 2012. IHS expects that with growth in broadband speed, users and connected devices, this market will have expanded to close to $30bn by 2017.
Across many markets, this segment is dominated by ad-funded players, such as broadcasters and user-generated services, as major device-based platforms have yet to roll out the full complement of content services. But there are growth challenges ahead for many video providers – they can no longer rely on growth in user base driven by broadband rollout to drive service usage and monetisation.
YouTube provides an early indication of this, having already reached its user-growth inflection point. YouTube is now focusing efforts on increasing the time spent by its existing user base, promoting the development of original content and developing new monetisation models.
Building new content brands is a slow process, and broadcasters have time to react to developments to shore up their own content portfolios and take advantage of existing reach to build their own brands around web originals – a move which many are now beginning to make.
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IHS Screen Digest is the largest media-focused research firm in the world, with more than 50 analysts covering over 65 global territories.