Study: Average U.S. SVOD Household Has Access to Almost 100,000 Hours of Content

The average U.S. SVOD household has access to almost 100,000 hours of content, delivered via 3.8 different services, according to research from Ampere Analysis.

It would take 11 years to watch it all back-to-back, and nearly 70 years if the average viewer watched an average of four hours per day, according to Ampere. The main factors driving this increase in content availability are consumer uptake of Amazon Prime’s booming portfolio and the addition of new services such as Disney+ to the household mix, according to the study.

SVOD engagement is even more prominent in households with young kids. Those households have access to nearly five different SVOD services, more than any other demographic. This is up significantly from 3.5 in the same period last year, largely due to the launch of Disney+, and the high uptake of the family-friendly service in the group, according to Ampere. The content available to this demographic group via the VOD services in their household now stands at an average of 102,000 hours.

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Even adults who live alone have an average of 3.1 services, with the average one-person SVOD household having 85,500 hours — almost 10 years — of content at their fingertips.

Almost one third of U.S. SVOD households subscribed to Disney+ in Q1 2020. The service comes with a 4,200-hour catalog and thus adds an average of 1,400 hours of content to the typical SVOD household’s portfolio, Ampere noted.

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Amazon has more than doubled its content catalog in the United States since Q3 2017 according to Ampere Analytics data. The 60% of SVOD households who have both Netflix and Amazon accounts can access more than 100,000 hours of TV shows and movies.

“Consumers already have a vast amount of content at their disposal, and a U.S. household who subscribes to both Netflix and Amazon currently has access to more than 100,000 hours of content from those two services alone,” Ampere senior analyst Toby Holleran said in a statement. “As the market fragments further with additional direct-to-consumer services and households hit a spending ceiling, consumers will become more selective about their SVOD choices. The more expensive services, alongside those without a clear brand and proposition, will find the going gets tougher.”

Scandinavian TV Operators Focus on Original Content to Compete Against Netflix

Scandinavia, which includes Norway and Sweden, Denmark, Finland and Iceland, has long been a stronghold for over-the-top video distribution. HBO launched its first SVOD service, HBO Nordics, in the region in 2012.

Swedish TV operator Com Hem in 2014 was one of the first cable operators to offer subscribers direct access to Netflix. The SVOD pioneer is now the largest streaming service in the Nordics with more than 5 million subscribers.

As a result, local TV distributors have partnered (Nordics 12) to up local content production in an effort to better compete against Netflix.

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Despite boasting a large catalog of international content and having made investments in local titles such as “Red Dot” (Netflix), foreign SVOD services have largely ignored domestically-produced series. This has led local OTT competitors to develop their own locally produced originals as a differentiating factor, according to new data from Ampere Analytics.

Indeed, Netflix Sweden features just 3% local titles, while Amazon Prime Video offers 1% local fare. Meanwhile, almost half (47%) of the content offered by CMore and 13% of Viaplay’s is locally produced, and the majority of Nordic content currently in production has been commissioned by local players.

Viaplay as the biggest commissioner of new TV shows in the region, followed by public broadcasters SVT, YLE and DR.

Analyst Léa Cunat said local and regional distgributors are ramping up investment in originated content, either individually or as part of partnerships like Nordic 12 to win audiences’ loyalty in both local and international markets.

“Across the globe we’re seeing local TV groups trying to take on the power of the global streaming services by capitalizing on whichever gaps in the market exist,” Cunat said in a statement.

Report: China Has 60% of Top Global SVOD Services by Subscribers

Government restrictions in China have stymied attempts by Netflix and Amazon to launch subscription streaming video service in the erstwhile Communist country with nearly 1.4 billion people.

As a result, new data from Ampere Analytics found that three domestic Chinese SVOD platforms iQIYI (backed by Baidu), Youku-Tudou (backed by Alibaba), and Tencent Video (backed by Tencent) now represent three of the top-five SVOD services globally by subscribers.

Historically, Chinese SVOD services were different to Netflix by focusing on ad-revenue. In recent years there has been a shift toward ad-free SVOD. By the end of 2018, the three leading Chinese streamers generated $8 billion of revenue — compared to Netflix’ $18 billion.

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By investing heavily in content, the three SVOD services have optimized their revenue composition. Between 2011-2018, iQIYI’s content costs grew by 140%, according to Ampere.

Subscription income was just 4% of total revenue back in 2011; by 2018, it had ballooned to more than 50% of its total revenue. Paid subscribers have privileged access to more exclusive content than the free-tier subscribers.

Investments in content have enabled the Chinese SVOD services to build large content catalogs. Youku-Tudou leads with 13,000 titles, followed by iQIYI at 10,000, and Tencent Video at 7000.

Catalog size is the main point of differentiation as the platforms offer a similar wide-range of content across TV series, movies and reality shows aimed at a mass-market audience.

Service stacking is common, as a result of the original and exclusive content on offer. iQIYI offers 250 original and 1000 exclusive titles, while Tencent Video has 330 original and 1400 exclusive titles.

Ampere says 44% of Chinese Internet users subscribe to two or three services, and 16% to all three. So, while the demographic targeting by the three giants may be consistent, the differentiation happens at the point of delivery through the content offered.

The report expects the continued growth of Chinese SVOD by the big three players as they continue to be buoyed by significant financial backing.

This has enabled iQIYI, Youku-Tudou and Tencent Video to expand rapidly, in addition to exclude smaller local players from entering the marketplace. The domination is further secured by the strict regulatory environment in China, which prevents international players such as Google operating there.

We expect the big three SVOD players in China to continue growing and reach 340 million subscriptions and $12.6 billion in total revenue by the end of 2024,”  analyst Orina Zhao said in a statement. “Investing heavily in content will continue as the main strategy to drive subscriptions and increase user retention.”