UKs Online Television Revenue Expected To Grow

It is hoped by the UK television industry that revenues from online video services quadruple by 2020. This includes pay and advertising revenues in this growing industry, according to media management company Red Bee Media.

Online TV revenue in UK rising

The outlook for the UK television industry is optimistic, as online television services are growing and infiltrating homes across the UK. These services are offered through home PCs, set-top boxes and television sets and utilise existing and new broadband cables.  This is thought to be the area that will bring the most growth to the industry.

The annual revenue from this area is expected to quadruple by 2020, which is a 230% increase from the year 2010. Revenue from other areas is expected to rise as well, with product placement and ad-funded programming likely to increase as more channels, networks and audiences are able to be reached.

Due to the nature of this growth, it is expected that competition will increase, as new players join the market and the old companies either evolve or grow. The infrastructure currently in place is likely to evolve with new cables being laid and technologies continuing to grow. The major players with be the internet providers and the hardware manufacturers. These are the ones who are going to have to please a customer in a service area that comes with high pressure from expectations.

The content rights are sure to start a fight, as current cable and pay TV providers see their share of the industry dwindle as customers move to the new technologies of Web TV and Smart TV. The competition for premium rights is expected to grow due to the influx of companies fighting for sports and other packages.

Use of technology is expected to grow as well, with the numbers of IP enabled devices and platforms to be in more homes. It is highly likely that a quarter of adults will be streaming and watching video content through the gaming consoles, an increase from 12% in 2010.

According to the CEO of Red Bee Media, Bill Patrizio, the question the industry needs to ask itself will there be disruptions due to new technologies being brought on to the market, or will the new technologies be able to sustain the expected rate of growth. The likelihood of a consumer driven environment is highly likely, with companies having to compete for new customers in a new area. The competition will be between two industries, ISP providers and cable TV providers as well as between individual companies. The fight for the customer dollar will be a hard fought one.

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