TVOD movie transactions to rebound in 2023: PwC

PricewaterhouseCoopers (PwC) has released new data indicating a positive outlook for the transactional video-on-demand (TVOD) movie market in the US. After experiencing a decline in revenue over the past two years due to a surge in 2020 caused by the pandemic-induced home entertainment boom, the market is expected to return to growth in 2023.
According to PwC's analysis, the TVOD market is projected to achieve a compound annual growth rate of 2%, reaching a revenue of $6.2 billion in 2027, compared to nearly $5.7 billion in 2022. While TVOD revenue decreased by 4.4% in 2022, it is expected to reach its peak growth of 3.2% in 2024, before settling at an annual growth rate of 1.2% by 2027. However, TVOD's market share will continue to decline as advertising-supported VOD (AVOD) and subscription VOD (SVOD) gain prominence, dropping from 11.5% of total U.S. over-the-top (OTT) revenue in 2022 to 8.3% in 2027.
Although TVOD remains a smaller market compared to subscription and ad-supported VOD, PwC highlights that by the end of the forecast period, TVOD will still rank as the fourth-largest global market in terms of total OTT video revenue.
PwC's positive outlook stands out as TVOD revenue in Q1 2023 experienced a decline of more than 12%, reaching $564.35 million, compared to $643.57 million in the same period the previous year. However, TVOD revenue in 2022 saw a modest increase of 1.7% to $2.51 billion, up from $2.47 billion in 2021. Notably, digital transactional spending on theatrical content rose by 11%.