Content providers like Hulu, Netflix and Amazon helped the over the top (OTT) video market to surpass $8 billion (£5.2 billion) in 2012.
According to new figures released by ABI Research, the three largest global markets – Europe, North America and Asia-Pacific – saw year-on-year growth of more than 50 per cent during the 12 month period.
In addition, the ever-rising popularity of mobile devices such as smartphones and tablets are expected to drive the market beyond $20 billion by 2015.
Michael Inouye, senior analyst at the research firm, said the shift to OTT distribution and digital is accelerating as an increasing number of content operators warm to internet channels.
He added that while Pay-TV services are still the preferred option for many companies, “we are approaching the proverbial fork in the road when content owners will decide if they continue down the same path or forge ahead”.
Moving forward, ABI Research stated it expects to see a greater diffusion of revenue across various business models, which will be driven by a shift in consumer demand towards newer forms of digital content distribution.