Streamers' revenue growth downgraded amid AVOD roll-out delays

Global streaming platforms Netflix, Disney+, HBO and Paramount+ are forecast to receive an equal share of income from advertising and subscriptions over the next five years as they roll out ‘hybrid offers’.

Digital TV Research’s findings show that video-on-demand (VOD) revenues from hybrid ad-funded (AVOD) and subscription (SVOD) will total $20bn by 2029, more than three times as much as this year ($6bn).

These hybrid revenues will be nearly equally split between AVOD and SVOD, the research company has found.

However, the forecasts are “a lot lower” than previously estimated because the international roll-out of AVOD tiers has been either scaled back or delayed.

The biggest streaming platform by revenue is forecast to be Disney+, with its $6.8bn revenue split between income from advertising ($3.5bn) and subscriptions ($3.3bn). Netflix has slightly lower revenue projections, while Paramount+’s hybrid business is expected to be about half of the Big Two.

While Netflix and Disney+ both rolled out cheaper, ad-supported subscription tiers in the US last year, their international expansions has been slower than expected. Netflix launched “Basic with Adverts” in November last year and Disney+ with ads is slated for a November 2023 launch.

Simon Murray, principal analyst at Digital TV Research, said: “These platforms are expected to roll out hybrid AVOD-SVOD tiers to the world’s top advertising markets in the near future. These forecasts are a lot lower than our previous ones as the platforms have delayed and/or scaled back their expansion plans.

“We have cut back the number of countries where these hybrid tiers will start. By 2029, we expect that Netflix and Disney+ will both be in 46 countries, HBO Max in 35 countries and Paramount+/SkyShowtime in 37 countries.”

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