By offering users control of their video viewing experience, Video on Demand (VOD) has become a solid business for cable operators, but its growth has remained relatively stagnant. While VOD is available in 90 percent of most cable MSO's respective footprints, a Multichannel News story citing a report from Magna Global, says that cable VOD growth is far from stellar. VOD continues to trail the growth of new services such as digital video recorder usage and Web-video adoption. What's more, the cable industry has struggled to create profitable advertising models that could attract more advertisers and programmers.
Given these factors, Magna reports that advanced advertising, an element that incorporates VOD, will grow only by $23 million this year to $161 million, compared to $138 million in 2008. Other industry groups were slightly less pessimistic. PricewaterhouseCoopers' "Global Entertainment and Media Outlook: 2009-2013" report forecasts that cable operators will see $4.5 billion in VOD revenue in 2013, an increase of approximately $2.8 billion from 2009's projected revenue total. And despite diverging views on VOD growth, some analysts such as Bruce Leichtman said that the industry should realize that VOD growth is evolutionary not revolutionary.
- Multichannel News has this report
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