Household Video Budgets Dropping, Multiplatform Viewing Is Down
Fresh data from Parks Associates suggests U.S. households may have hit a plateau in their online video viewing; the experimentation phase is over and people are settling into more comfortable habits.
While the amount that U.S. broadband households spend on video entertainment outside of their pay TV subscriptions has held at $29 per month for the last two years, that dropped to $23 in the last six months of 2017. This shows less spending on movie theater tickets, DVDs, and Blu-ray Discs.
More significantly for streaming video providers, the number of devices people use to stream video is dropping. While 92 percent of all U.S. broadband households stream to a connected device, they're using fewer devices, suggesting that people are settling into patterns and watching more on their favorite screens.
Currently, one-fifth of pay TV customers can access streaming services through their pay TV boxes. Parks finds people like the convenience of having less hardware, and one-third of pay TV customers want to access online content through their pay TV guide.
"Users are experimenting less with multiple connected devices, but they continue to experiment with multiple OTT video services," says Hunter Sappington, a research analyst at Parks Associates. "Many consumers now see OTT video as complementary to both other OTT video services and pay TV services, rather than a replacement. Today's OTT market is much more about bundling and partnerships than it is about winning subscribers from direct competitors."
This data comes from Parks' reporting on connected consumers, available for purchase.
Younger viewers especially get much of their live video from online sources. Pay TV customers need to shift their offerings to stay relevant.
The OTT market is booming, as 69% of broadband households now have a subscription, and many subscribe to 3 or more services.
Sling TV makes a big jump in the top 10, but skinny bundles in the works from DirecTV and Hulu are certain to shake things up.