2013 is expected to be another big year for digital technology and the continued rollout and adoption of UltraViolet will provide greater availability of digital content than ever before.
Currently DVD and Blu-ray sales account for a significantly higher percentage of Home Entertainment content than digital items purchased. This could be attributed to physical media being more widely available from many different sources, whereas the selection of online services is nascent.
Where online services are available, they often exist as subscription services allowing users to access a wide variety of content for a monthly fee; this content however is never owned by the users. The market share of SVOD models is set to decline over the next couple of years with transactional services predicted to dominate the OTT Global market share by 2017.
What is likely to reinforce the value of ownership and assist this shift of growing EST services, is the introduction of UltraViolet. This will enable users to physically buy a UV compatible item and then access it online, thus educating users on the concept of owning digital content in the cloud; similar to your DVD library on your living room shelves, but now the content is available on any device anytime, anywhere.
As UltraViolet currently only supports a purchase model we may see a market shift in how users are accessing content, and, according to recent estimates the percentage of EST revenue in the North American OTT market is set to increase from 8% to 13% from 2012 to 2017 whereas the SVOD market share is set to decline from 59% to 36% in the same period.
Subscription services will continue to keep those consumers who enjoy a wide variety of content (but aren’t concerned with owning it) happy, but if the predicted increase of EST revenue is accurate, it will be key for any digital retailer to support multiple models of content in order to keep up with the changes in consumer behaviour.