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Skinny Bundles Plus A-List Content Could Sway Cord-Cutters

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Pay TV providers remain under pressure from cord-cutting but could use skinny bundle offerings to staunch the flow, finds a new report from Vorhaus Advisors.

News 2The Digital Strategy Study further underlined the trend towards OTT viewing among younger audiences on mobile devices and that viewing to the TV remains popular, particularly among people over 35.

Nearly half of respondents to the survey fingered cost as the primary reason for ending their pay TV relationship. But there are pull factors, as well.

Cord cutters are more likely to use SVODs than switch to another provider, but only 22% of study respondents wanted to replace their existing TV service with comparable content offers online.

It’s the lure of exclusive or original movies and TV content which is the key reason to subscribe.

Cord cutting isn’t going to stop anytime soon. In this survey, around 14% of younger adults and 10% of older ones say they’re extremely likely to ditch pay TV in the next year. Consumers also say they are likely to sign up for another 1.6 SVOD services beyond what they already have, indicating that the offerings coming from Disney, WarnerMedia, and Apple could find a receptive audience.

But there is some hope for pay TV if it can attract back the 35% of cutters interested in subscribing to a skinny bundle as an alternative.

“Skinny bundles might be a saving grace for pay TV companies,” noted Mike Vorhaus, CEO of Vorhaus Advisors.

To succeed, skinny bundles should offer original series or some form of must-see entertainment that viewers can’t get elsewhere. Generating enough revenue from cheaper pay packages to invest in the original content that audiences want is a tricky business model.

The demo 35-years-and-older is most receptive to skinny bundle offers.

Among 18- to 34-year-olds, traditional TV viewing continues to fall far behind viewing on digital devices, with 72% in that group using a smartphone to watch online video once a week or more, compared with only 56% who used an internet-connected television. However, despite a preference for digital devices among 18- to 34-year-olds, television is still the top-rated device for the broader population over the age of 18.

Furthermore, half of all SVOD viewing is done on an internet-connected TV, proving that subscription apps are critical to connected TV’s popularity.

Live streaming is in a healthy position with further testimony to the success of Facebook’s video strategy. Facebook Live is the most used live streaming platform at 39% of consumers, closely followed by YouTube Live (37%) but level pegging with Facebook’s Instagram.

News dominates live stream interest (39%), surprisingly followed by comedy (37%), though it’s hard to see how there’s enough live comedy out there.

If aggregated together, sports and esports top the lot with 60% of live streamed interest although the survey didn’t seem to include DAZN or Amazon Prime or other major online sports casters aside from Twitch. Live UGC streams from family and friends was popular among a third of people reflecting the overwhelming feeling from the survey that live helps people feel more connected to stories, events, and other people.

The debut study from Manatt, Phelps & Phillips, analysed survey responses from more than 2,000 respondents over the age of 18. The sample was matched to the U.S. Census for age, gender, and race, and questions focused on media attitudes and the behaviors of consumers on a broad range of topics.

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