Digital Streaming Services Face Challenges to Double-Digit Growth, PQ Media Reports
Spending for digital video, audio, news and games will increase 6 percent, down from 6.3 percent last year, to $1.8 trillion worldwide in 2018, PQ Media reported Wednesday. Growth slippage is due to declining trends in mobile media, digital device…
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penetration nearing saturation, decelerating economic growth and a slowdown in the number of middle-class consumers who can afford first-time digital gadgets and subscriptions. The only gadget category with improved growth was digital audio components, spurred by popularity of smart speakers. Consumers worldwide will spend an average of $325.25 this year on digital and traditional media, access and technology, up 5 percent, on strong growth in services like Netflix in video and Spotify in audio, both of which doubled subscriber counts vs. 2016, said PQ. Such growth faces headwinds including censorship firewalls and quotas for native-language content, the researcher said. Upcoming content renewals in 2019 and 2020, particularly in audio, may “substantially” boost licensing fees and be passed on to consumers, it said. For the first time, mobile media won't post a double-digit gain in 2018, as digital access spending is dropping “on younger demographics cutting the cord,” said analyst Patrick Quinn. Due to saturation, global cellphone shipments declined for the first time in Q3, while tablet sales fell below a double-digit growth rate in most major markets. The U.S. is projected to remain the top market for media, access and technology, at $442.7 billion in 2018.