September 2, 2019
No wonder Netflix wants to enter the Chinese market.
The quasi Communist country topped the U.S. in gross subscription video-on-demand users in 2018, according to new data from Digital TV Research.
China added nearly 60 million SVOD subs compared to 27 million subs in the U.S. India nearly doubled its subscription base.
Netflix does not operate independently in China, partnering instead with iQiyi to distribute select programming.
Gross SVOD subs increased by 139 million in 2018 to 508 million – or up by 38%. The net subscriber count rose by 83 million in 2018 to reach 357 million – up by 31%.
DTV Research said the average SVOD subscriber paid for 1.43 subscriptions by end-2018 — up from 1.05 in 2010.
“China and the U.S. together accounted for 63% of the global total in 2018,” Simon Murray, principal analyst at DTV Research, said in a statement.
Eight countries had more than 10 million SVOD subs by end-2018 – collectively providing 80% of the global total.
Gross SVOD subs represented 30.5% of TV households by end-2018. The proportion of net SVOD subscribers was 21.4% – meaning that more than 20% of the world’s TV households had at least one SVOD subscription by end-2018.
SVOD became the largest OTT revenue source in 2014 when it overtook ad-supported VOD. SVOD market share reached 53% in 2018. SVOD revenue increased by $11 billion in 2018 to $36 billion – up by 44% from 2017. AVOD revenue increased by $5 billion to $22 billion.
“The U.S. added $6.5 billion in revenue in 2018, with China up by $3.6 billion,” Murray said. “Therefore, the U.S. and China were together responsible for more than half the world’s additional revenue in 2018.”