Parks: One-Third of Broadband Homes Have Multiple OTT Video Services

29 Dec, 2016 By: Erik Gruenwedel

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Netflix may be the No. 1 domestic subscription streaming video service, but it has company. One-third of broadband homes subscribe to more than one OTT service, according to new data from Parks Associates.

The most popular services are Netflix and Amazon Video — 12% of all U.S. broadband households have this combination. Brett Sappington, senior director of research, said consumer willingness to subscribe to multiple services (including Hulu, Acorn TV, WWE Network, etc.) provides the rationale for continued industry growth.

“There are service stackers willing to experiment with different OTT combinations as new services arise,” Sappington said in a statement. “The regular release of … original content, such as “The Grand Tour” (Amazon) and “Gilmore Girls: A Year in the Life” (Netflix), ensures the large OTT players will remain a core, consistent subscription among service-stacking households.”

Multiple SVOD services means U.S. consumers pay an average of $29 per month for incremental video-related entertainment beyond pay-TV. That dwarfs domestic broadband household monthly spending on digital movies, which Parks pegs at just 80 cents. Meanwhile, movie exhibitors saw consumers spend an average of $9.32 per month on tickets.

With the launch of DirecTV Now and pending platforms from Hulu and YouTube, online TV services and live broadcasts of linear channels will be a common theme in 2017.

“The average spending on subscription OTT video has increased over the past four years, with a notable jump in 2016,” said senior analyst Glenn Hower. “[Yet] the $7.95 average monthly spend on SVOD is nearly identical to the $7.99 price of entry-level service tiers for Netflix and Hulu, indicating that consumer expectations for domestic pricing has been set by [the two services].”
 

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