15% of Pay TV Customers Downgraded Service in the Last Year
According to the researchers at Parks Associates, 15 percent of all pay TV subscribers in the U.S. with broadband connectivity downgraded to a less expensive service in the last year. Also, 34 percent changed their pay TV service in some way. Other changes include switching to a new TV provider, upgrading to a more expensive service, subscribing to a TV service after not having service for a year or longer, and subscribing to a TV service for the first time.
The industry is seeing a wave of people leave pay TV and sign up for one or more OTT accounts. According to Elizabeth Parks, senior vice president at Parks Associates, OTT subscription numbers keep rising—with 64 percent of U.S. broadband households now signing up—while pay TV subscriptions are declining.
Last week, Parks revealed that 47 percent of U.S. homes with broadband watch user-generated content two or more times per month.
"User-generated live content is gaining popularity, with platforms such as Instagram Live providing new ways for content creators to engage with their viewers in real-time," says Billy Nayden, research analyst for Parks. "As more alternatives to traditional TV emerge, all players will explore new and unique ways to package and present digital streaming as part of their services."
HBO Now and Starz enter the top five, showing the popularity of premium original content to subscribers, says Parks Associates.
Young people who post videos to online platforms and spend a lot of time watching shared content are less likely to opt for paid services.
Esports will emerge as a major profit center with 4 in 10 willing to pay for a subscription and roughly the same number willing to pay per event.
Younger viewers especially get much of their live video from online sources. Pay TV customers need to shift their offerings to stay relevant.