The new opportunity for streaming video on pay TV set-tops

Streaming video is a new programming category on pay TV set-top boxes.

Pay TV set-tops have tradi­tionally been used to provide viewers with access to linear TV and VOD.  Recently, operators have begun deploying new set-tops that include support for ad-supported, Internet-delivered streaming video.  We estimate streaming-enabled set-tops in U.S. homes will grow to reach +50 million TVs by the end of 2015.  The value propo­sition is:

  1. The quality and popularity of “made-for-digital”, streaming video rivals the quality of tradi­tional, made-for-TV content (e.g. Amazon, Netflix Win Big at Golden Globes).
  2. Video producers and operators earn high-CPMs from new adver­tising inventory created by the delivery of streaming video to pay TV STBs.
  3. Audiences are attracted by the simplicity of being able to watch linear, VOD and streaming through a single STB and remote control.

The numbers tell the story — scale & revenue — for streaming video on pay TV:

average MOV by platform