March 20, 2019
U.S. broadband household spending on subscription OTT video services has held steady for three years, averaging just under $8 per month since 2016, according to research from Parks Associates.
The figures suggest adoption of multiple services or expensive services by some consumers is offset by a larger base of consumers who either subscribe to one or two relatively inexpensive services or who do not spend any money on OTT video services (30% of consumers), according to Parks Associates.
“The stability in average household spend belies the activity going on under the surface,” said Brett Sappinton, Parks Associates senior director of research, in a statement. “2019 may be poised to break that trend. Netflix, Hulu and Amazon continue to pack on new subscribers. At the same time, services like ESPN+ are also experiencing phenomenal growth, and new offerings from Disney and WarnerMedia are set for release later this summer. One of three things will happen — more households will become OTT streaming households, rival services will begin to pull subscribers away from Netflix, or that spending number will go up.”
Parks Associates will discuss strategies to launch successful services in the complimentary webcast “Avoiding OTT’s Top 5 Mistakes,” co-hosted with Swrve March 26 at 11 a.m. CST.
“The deluge of OTT platforms has created greater competition for video based on choice and quality of content,” said Barry Nolan, chief strategy officer at Swrve, in a statement. “Yet as people spend more and more time consuming digital media, OTT platforms are seeing a lag in customers insights, loyalty, and revenue. We believe that by delivering the perfect message at the perfect time, OTT platforms will have a richer and more enduring experience with their customers.”