According to the latest market study by LRG, the thirteen largest pay-TV service providers in the U.S. market — representing 95 percent of the total market — lost about 190,000 net video subscribers during the third quarter 2015 (3Q 2015), that’s compared to a loss of about 155,000 subscribers in 3Q 2014.
Source: Digital Lifescapes
Applications revenue grew by only 3.9% year-to-year in 3Q15 for the 23 software vendors tracked by TBR. Meanwhile, Cloud adoption generated subscription revenue growth of 39.9% year-to-year in the quarter — causing new license sales decline to accelerate to -25.3% during the same period.
Continued cloud adoption maintained double-digit software subscription revenue expansion of 46.6% year-to-year in 2Q15 — but traditional license revenue declined by -21.4% in 2Q15. Meanwhile, applications revenue grew only 1% year-to-year for the 23 software vendors tracked.
Infrastructure management software vendors experienced an average 48% growth in subscription revenues, but license and maintenance revenue averages declined. TBR believes these figures illustrate the ongoing business model shifts from software license and maintenance agreements to more flexible subscriptions.
The ongoing success of open source software subscriptions continues to take a heavy toll on traditional vendors. Application software revenue grew by just 2.7 percent year-to-year for the twenty-three vendors tracked in Technology Business Research (TBR) “Applications Software Vendor Benchmark” study.
Across the digital content arena, there has been a gradual transition from the pay-per-download model to a month-to-month or annual subscription. This transition is very apparent in the mobile space, where the majority of applications are now free at the point of download.
Growth in digital video subscriptions, rentals and purchases will hold total consumer revenue from traditional home entertainment sources steady. According to IHS, digital purchases are set to grow by 75 percent between 2013 and 2017. In terms of worldwide consumer revenue, IHS forecasts that digital movie purchases will reach $2 billion by 2018.