Direct subscribers likely to dominate streaming market: UK-based Omdia

UK-based Omdia expects bundling of streaming video with telcos to plateau by 2029

How critical is bundling to the growth of streaming video?

In the second quarter of 2024, there were more than 1,900 partnerships between subscription-driven streaming services and telcos/broadband companies. Yet, a bulk (62 per cent) of the 1,570 million global video subscribers had signed on directly for a Netflix or a Disney subscription, among many others. About a fifth or 317 million came indirectly through a telecom, broadband, or smart TV service that came bundled with a video app.

By 2029, this figure will go up to one-fourth of the total. Globally though, the lion’s share of new subscriptions will continue to come from standalone direct customers. Those are among the big takeaways from two recent reports from the UK-based technology research and advisory firm Omdia.

Its telco-streamer tracker counts a total of 121 distribution partnerships in India. Of these, 95 were live in the first half of 2024.

“India is one of the markets where bundling is relatively well-developed. Both Tata and Reliance have long sought to make telco products and services integrated with the bundling of online video streaming,” says Tony Gunnarsson, principal analyst, TV, Video and Advertising at Omdia. Total pay streaming video subscriptions in India, according to Omdia, are set to hit 62 million at the end of 2024. Of these, 47 million are direct-to-consumer, leaving some 16 million subscriptions bundled via telcos. Bundling makes up 25 per cent of the total Indian SVOD (subscription-driven video-on-demand) market in 2024, which is above the global proportion of 20 per cent.

“About two years ago, we noticed that bundles had begun to massively take over streaming. Bundling jumped from less than 10 per cent in 2020 to 20 per cent of the total SVOD in 2023. Initial forecasts suggested that bundling had the potential to at least match direct-to-consumer by the end of 2020s. What we now see quite clearly, however, is that bundling will remain at around 25 per cent of all SVOD subscribers globally for the foreseeable future,” says Gunnarsson.

Why does it matter?

“Customers are alternating between services. The key challenge for the industry is to solve the re-aggregation /re-bundle question. Telcos (therefore bundling) won’t solve this issue for TV and video,” says Gunnarsson.

He also referred to the clutter of services. From just under 3,000 streaming services globally in 2012, there were 5,584 in the third quarter of 2024. In India, the total number of online video services tracked by Omdia is 101. Of these, only 67 were live as of the second quarter of 2024. This seems like a very small number, given how much programming is out there.

“Our tracker is skewed towards paid streaming services,” said Gunnarsson.

Omdia forecasts that the actual number of bundled SVOD subscriptions in India will grow to 22 million in 2029, bringing bundling down from 25 per cent to 19 per cent of 116 million homes that will pay for OTT services then. There just might be a decent aggregation service by then.