July 7, 2020
Premium video-on-demand, affording consumers concurrent access to new-release theatrical movies in the home, has been resurrected from its deathbed by studios as a distribution alternative with the coronavirus pandemic shuttering movie theaters.
New data from Hub Entertainment Research finds PVOD is embraced by young consumers, with more than 60% of survey respondents (18-34 years old) indicating they would probably pay to stream a just-released movie.
That interest is nearly non-existent among older consumers (35+), with just 12% indicating interest and only 2% saying they would “definitely” pay for PVOD.
The data comes from Hub’s “Monetizing Video” study, conducted in June among 2,036 U.S. consumers with broadband, age 16-74, who watch at least 1 hour of TV per week.
Notably, price doesn’t appear to be an issue for young consumers when it comes to streaming a first-run film in the home. Assuming a price of $15 to stream, 67% of 18- to 34-year-olds would definitely or probably pay. The proportion is virtually the same (65%) at $25. Amazingly, a majority of young viewers (57%) would also be willing to pay $50.
“For younger movie fans … the strong preference for streaming for TV and first-run movies, has the potential to fundamentally shift the entertainment distribution dynamic, assuming the industry is ready to accept the collateral damage —to the pay television and theater industries,” Peter Fondulas, principal at Hub and co-author of the study, said in a statement.
Separately, 70% of respondents cited Netflix, Hulu, Disney+ and Amazon Prime Video as the best value for the money among all all streaming services. Among traditional pay-TV subscribers (cable, satellite, telecom), only about 40% said they get at least good value.
Respondents on average said they pay $94 monthly for pay-TV/streaming — about $22 more than they would like to pay. Traditional pay-TV subs are the most likely to feel their total TV bill is higher than what’s reasonable, according to the study.
Those who have a cable, satellite, or telco subscription — regardless of separate streaming services — feel they pay $29 more than they should be paying.
For consumers who only have cable, satellite, or telco service, the actual vs. reasonable gap is actually greater: They pay $37 more than they consider reasonable. With an actual/reasonable gap of only $6, consumers who have streaming services only — no pay-TV service — are the most likely to feel they’re paying the amount they should be paying.
“At a time of tremendous economic uncertainty, streaming services with deep catalogs of content fill a critical emotional need for consumers: The need to satisfy their home entertainment needs at a manageable cost,” Fondulas said.