What are Canada’s couch potatoes watching?

In the next two years, OTT revenue is set to climb while TV's could go way down.

OTT is making some serious gains in Canada, and its gains might be TV’s loss.

That’s according to the latest study by Convergence Research, which has concluded its annual “Battle for the Canadian Couch Potato” review. The study uses the year-end revenue reports from the various internet, OTT and TV providers to determine subscription growth across platforms.

That figure is based on the increase in OTT revenues over the year, compared to the revenue that comes from Canadian television access.

Convergence estimates that Canadian OTT access revenue grew by 29% in 2017, bringing the total revenue to $872 million for the year. The forecast for this year is $1.11 billion, and by 2020, Convergence expects OTT revenue to reach $1.58 billion.

On the other hand, revenue for cable, satellite and other pay TV access (not including in-package OTT offerings) declined by 2% to total $8.74 billion. The forecast for 2018 is another 1% decline, coming to $8.64 billion this year.

Based on revenue, Convergence estimated that in 2017, Canadian TV services lost a total of 216,000 subscribers. This is fewer than the number lost in 2016 (225,000). However, based on the prominence of cord-cutting and the maturation of cable and satellite markets (according to Convergence, they have not added net new subscribers since 2010), the firm predicts that the decline will go at a more rapid pace in the next several years, at an average decrease of 2.6% per anum.

As of year-end 2017, an estimated 4.14 million Canadian households (28.1% of households) did not have traditional TV subscriptions, up from 3.78 million the previous year. The forecast for year-end 2018 is 4.55 million (30.5% of households).

Broadband subscribers grew by an estimated 442,000 people, the largest annual addition since 2009. Revenue grew by 8% to $8.06 billion. By year-end 2018, revenue is predicted to rise to $8.7 billion, exceeding the year’s predicted TV access revenue.