Audio Video News

Amazon is on track to have 76.2 million users of its streaming video service, about 3 million more than previously forecast, making it the fastest-growing streaming video service, according to a new report from eMarketer.

The research firm said the uptick is the result of Amazon’s efforts to unbundle its Prime video and shipping subscriptions, which has spurred more viewers to sign up for the stand-alone streaming video service, which is projected to grow 16.5 percent this year.

“Amazon’s growth in digital video viewers is driven by three factors: the success of its Fire TV streaming devices, the roll-out of a standalone streaming video service, and its increased investment in original content, which the Boston Consulting Group estimates at $3.2 billion this year, second only to Netflix among video platforms,” said eMarketer senior analyst Paul Verna.

Netflix is still the category leader with 120 million users but its growth is slowing as the service matures and raises its prices.

“Netflix has a larger user base and therefore less room to grow, but it continues to add subscribers in the U.S. and elsewhere thanks to the appeal of its original shows,” Verna said. “The success of these companies, and of the OTT (over-the-top) category as a whole, indicates continued momentum for subscription-based, on-demand video.”

The exception is Hulu, the smallest streaming service, which will see its user base shrink to 30 million, less than half of what it had been, due to a new business model that no longer includes a free, ad-supported streaming service. eMarketer expects Hulu to grow slowly through 2020.

So which devices are Americans using to stream their favorite shows? Google Chromecast is the dominant device, due to its low price of $35. Noting that 30.6 million people will use Chromecast this year, eMarketer expects it to remain the market leader through 2020, barring any major market upsets.

Amazon Fire, the fastest-growing connected-TV device, is expected to overtake Roku in terms of users next year and double its user base by 2020, almost catching up with Chromecast.

Apple TV, by contrast, is struggling to grow. The service has 20.5 million users in the U.S. and is expected to grow to just 25.8 million by 2020.

“Apple TV has been saddled by the high cost of the device and its lack of support for content apps from the likes of Amazon and Spotify,” Verna said. “Also, compared with Amazon, Apple has yet to make inroads into original programming. The promise of an Apple ecosystem of content and devices—something it mastered with the iTunes Store a decade ago—has yet to materialize in the fast-growing world of digital television.”