Worldwide VOD rentals (OTT and pay TV operator), electronic sell-through (EST), and DVD/Blu-ray disc sales are expected to grow 40% from 2013 to 2019 - growing from $30.6 billion in 2013 to over $43 billion in 2019.

Physical media sales will continue its decline, while OTT VOD services and ad-based viewing take significant market share from combined physical purchases and EST.

Senior analyst Michael Inouye commented: "New content windowing strategies, such as early VOD and EST release dates, will continue to push consumers to these distribution channels.In addition as pay TV operators increasingly pursue OTT initiatives the consumers will further migrate to digital distribution."

Despite this trend, physical media will continue to play a significant role for many consumers, particularly for those who have extensive DVD/Blu-ray libraries, purchase 4K TVs and want higher quality video than HD streaming services, or simply prefer having a copy in hand. 'Traditional' media still has plenty of resiliency left and in some cases a large amount of control over the content.

Practice director Sam Rosen added: "As consumers move to digital distribution the wildcard in this transition remains the pay TV operators who, for the time being, still hold the most bargaining power for content rights. How these operators approach multiscreen services will dictate how well these players retain control over when, where, and how consumers watch video. Recent activity in OTT services and content purchases from operators like AT&T, Verizon, and Dish offer a glimpse into how these incumbents are working to move with consumers as viewing behavior changes."

Story filed 10.05.14