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Tracking the Rise of the Broadband/OTT Bundle

Authenticated TV Everywhere services were developed in part to head off the cord-cutting trend, but a new study from Parks Research shows that TVE has not stopped a small and growing batch of consumers from bundling broadband with over-the-top video services while shunning traditional pay TV.

Offering a fresh view of that trend, about 7% of U.S. homes now subscribe to broadband and an over-the-top video service, but don’t take a TV service from a cable operator or another multichannel video programming distributor, Parks Associates found in a new study, TV Everywhere and the New World of OTT.

Parks Associates said that figure includes consumers who have cut the pay TV cord, or have never subscribed to a pay TV service.

The firm said this trend is causing multichannel video programming distributors, such as Dish Network, to launch OTT services with a slimmed-down TV lineup that appeal to consumers who don’t want pay TV. It’s also opening the door to fuller-freight offerings such as Sony’s PlayStation Vue.

“The OTT video services marketplace continues its rapid rate of change, impacting the video ecosystem across world markets,” Brett Sappington, director of research at Parks Associates, said in a statement. “While operator attempts at TV Everywhere have made little impact, OTT video services are experiencing a boom.”

Parks Associates said 57% of U.S. broadband homes now subscribe to an OTT video service, compared to 57% in the U.K., 29% in Spain, and 24% in Germany.

Even as traditional pay TV subscriber growth tapers off, the research firm is forecasting that OTT video service subscription revenue will rise from nearly $9 billion in 2014, to over $19 billion in 2019.