Nearly half of all pay-TV customers might either switch providers or go over the top, according to a new study.
The second-quarter study, conducted by Digitalsmiths, a unit of TiVo, found slightly fewer subscribers thinking about making a change than last year, but more of them were familiar with OTT options and more said that the things that made switching attractive were interesting to them.
The survey found that 14.9% of respondent planned to either cut their service, change providers or switch to an online app or rental service. Another 31.7% responded maybe when asked if they might switch providers.
The percentage—46.6 total—is down slightly from last year.
The survey found that 79.4% of respondents are interested in an à la carte pay-TV service where they can select and pay for only the channels they want to watch. On average, respondents’ ideal á la carte package would consist of 17 to 18 channels. Respondents said the most they would pay for their ideal à la carte package was $39.50 a month.
According to the survey, 57.5% of respondents were aware of streaming OTT services that provide skinny packages with linear TV such as CBS All Access, Hulu, PlayStation Vue, and Sling TV.
The top three reasons why consumers turn to OTT services are convenience, ability to watch certain TV shows and whole seasons and cheaper costs.
The number of people pointing to those has risen, as has the popularity of OTT services. For example people citing the ability to watch TV and movies on your iPad grew 1.1% from last quarter, 7.2% from last year and 9.9% over two years. Ability to watch certain shows and whole seasons rose 3.8% since last quarter, 6.1% year over year and 20% over two years.
Easier to find what you’re looking for grew 3.4% year over year and 9.5% over two years.
“What do these trends mean to Pay-TV providers? The results demonstrate that respondents value the ability to watch video content on multiple devices, both inside and outside of the home. Additionally, the desire to view whole seasons and certain TV shows substantiates that binge viewing is real, and original content from these OTT services is taking off with respondents,” the report said. “Pay-TV providers often offer only partial seasons of shows in their on-demand offerings, which perhaps discourages consumers from leveraging these services as a destination for binge viewing. Lastly, the overall experience is important. Respondents see great value in things such as convenience, better selection, and the ease of discovering content they want to watch.”
Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.
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