Parks: 70% of U.S. Broadband Homes Own at Least One Streaming Video Service

New data from Parks Associates reports that nearly 70% of U.S. broadband households own at least one streaming video product that is connected to the internet.

Ownership of smart-TVs and streaming media players continues to rise, and gaming console ownership has held steady after several years of losses. Consumers have fully embraced streaming services, with more than 80% of broadband households having at least one service and 49% having four or more services.

“The streaming video market has experienced increased service usage, and consumers are watching streamed video content on multiple devices in the home and increasingly from multiple services,” Paul Erickson, director of research for Parks Associates, said in a statement. “The role of streaming video across multiple platforms is more important than ever before in the entertainment mix for consumers.”

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Fifty-six percent of U.S. broadband households now own a smart-TV. More than half of those households are now using the smart-TV as the device they access most frequently to watch streaming video. The increase in connected TV devices and viewership in turn has driven growth in the average number of hours per week of video consumed.

“The video developer community is seeing similar growth in their applications targeting multiple platforms, as OTT services support 10% more devices than they did last year,” added James Varndell, senior product manager for Bitmovin, a digital video technology company that assisted Dallas-based Parks in the research.

Seventy-two percent of broadband households are engaging in multiplatform streaming video viewing, and 40% are viewing on all platforms available to them, according to Parks.

“Consumer adoption of multiple streaming video services may slow, but their comfort with streaming content will persist — the connected home is now permanently a multiplatform environment,” said Erickson.

Netflix Leads Parks List of 2021 Top 10 U.S. SVOD Services

Netflix topped the list of Parks Associates’ 2021 top 10 U.S. paid subscription over-the-top (OTT) video services.

The list is based on estimated numbers of subscribers through September 2021 from the firm’s OTT Video Market Tracker.

The 2021 list shows the first change in the top three services since the firm started tracking the providers in 2015. Disney+ has moved into the top three, moving ahead of Hulu in number of subscribers. HBO Max moved into the top five, while Paramount+ (rebranded from CBS All Access) jumped to number seven on the list. New entrant Discovery+ is right behind at 11.

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Parks Associates’ 2021 Top 10 U.S. Subscription OTT Video Services (SVOD):

  1. Netflix
  2. Prime Video
  3. Disney+
  4. Hulu
  5. HBO Max
  6. ESPN+
  7. Paramount+
  8. Apple TV+
  9. Starz
  10. Showtime 

 

The research firm reports that, based on quarterly surveys of 10,000 U.S. broadband households, more than 80% of broadband households have at least one OTT service and that the churn rate for OTT services is 44%, with consumers adopting multiple subscriptions and experimenting with different services.

“While the Disney+ content portfolio may have allowed it to leapfrog stablemate Hulu in 2021 rankings, its position reaffirms the collective power of the Disney Bundle triumvirate: Hulu, Disney+ and ESPN+,” Paul Erickson, director of research of Parks Associates, said in a statement. “ViacomCBS’s successful rebrand and content-fueled reformulation of CBS All Access into Paramount+ have allowed it to leapfrog Apple TV+ into seventh place behind ESPN+, and time will tell if the service will break into the top five.”

“Broadband providers added an estimated 6.4 million residential customers to date in 2021, showing rapid growth,” Kristen Hanich, director of research at Parks Associates, said in a statement. “The importance of bundling pay-TV with home broadband is diminishing though — our Home Services Dashboard finds that only 38% of U.S. broadband households bundle pay-TV with their home internet service, a significant decline from past levels.”

The role of online TV continues to grow, with consumers embracing OTT services offered by familiar providers, according to Parks.

“In Q3 2021, 19% of U.S. broadband households reported subscribing to a vMVPD service, nearly double from the previous year,” Eric Sorensen, contributing senior analyst at Parks Associates, said in a statement. “By 2024, the U.S. vMVPD subscriber base will increase to more than 23 million households. All players will continue vying for the leading positions.” 

Parks: Online TV Household Adoption Nears 20%

Launched in 2015, online television was created in an effort to combat subscription streaming VOD as well as the eroding pay-TV market.

New data from Parks Associates finds that 19% of U.S. broadband households now have an online TV service, which typically offer bundles of live channels via third-party connected devices such as Roku, Amazon Fire TV and Google Chromecast.

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“Many households who cut the traditional pay-TV cord or never subscribed in the first place, are looking for a live and more linear video viewing experience via online options, which is driving [online TV] service uptake,” Paul Erickson, senior analyst at Parks, said in a statement. “These services also promise less-costly investment and more content flexibility, which increases the appeal among today’s video viewers, who are accustomed to the benefits of OTT solutions.”

Parks: 50% of U.S. Broadband Homes Have 4+ Streaming Services

New data from Parks Associates finds nearly half of all U.S. broadband households have four or more over-the-top streaming services, an increase of 3% since the first quarter.

The data, which includes free ad-supported video platforms and online TV, is based on a third-quarter survey of 10,000 broadband households.

“Free, live, and aggregated services such as online TV bundles and AVOD are rising in popularity,” Matt Smith, VP of business development at Symphony MediaAI, an entertainment software company, said in a statement. “Historically effective acquisition tactics such as free SVOD trials have fallen out of favor with Disney, Netflix and other market leaders. As industry service models shift, content providers must navigate even more fragmented revenue streams and customer engagement strategies.”

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Symphony MediaAI, along with eight other companies, is participating in Parks’ Future of Video virtual confab through today (Dec. 15).

Parks: U.S. Consumer Adoption of Smart-TVs Reached 56% in 2021

The use of internet-connected televisions in the home continues to grow, with 56% of U.S. broadband homes now using smart-TVs, according to new data from Parks Associates. Smart speakers/display penetration reached 53%.

Dallas-based Parks found that 82% of domestic broadband households subscribe to at least one over-the-top video service, up 6%, while 58% of households subscribe to a traditional pay-TV service, down 4% year-over-year.

“2021 has been a challenging year for consumers and businesses. While supply chain issues continue to be a concern, there is slow but steady growth in the smart home industry,” Elizabeth Parks said in a statement.

Parks said the percentage of domestic broadband households with standalone broadband service increased from 33% in Q1 2018 to 41% in Q1 2021, following the declining popularity of pay-TV bundles. Consumers pay $64 per month on average for standalone broadband service, up from $39 per broadband household in 2011, a 64% growth rate.

“Traditional and disruptive players continue to introduce new products, grow partnerships, and add features to expand offerings,” Parks said. “Privacy issues continue to be in the forefront of consumers’ minds as well as the ability of products to work together and with a unified app.”

Parks: 39% of Streamers Access Services Based on Specific Content

New consumer data from Parks Associates reveals that 39% of streaming video viewers access platforms based on specific content available. In partnership with Conviva, Dallas-based Parks is presenting its latest research during the industry webinar “The Role of Content Discovery in OTT” on Oct. 14 at 10 a.m. CT (11 a.m. ET). The webinar explores content discovery strategies that companies are using as a key differentiation factor in attracting new subscribers and keeping users engaged.

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“Content is key to OTT success, and the path for consumers today to get to that content is the crucial search and discovery process,” senior analyst Paul Erickson said in a statement. “OTT players are successful when offering a premium, personalized user experience that allows subscribers to find and access relevant content based on their habits and preferences. A perceptive and intelligent content discovery strategy is a key differentiator in attracting and engaging subscribers over the long term.”

Parks found that three out of the top five factors that drive streaming subscriptions involve content and that the inability to find relevant content is a top reason for consumers leaving a service.

“With so many entertainment options at viewers’ fingertips, it is more important than ever before for streaming publishers to understand how consumers discover content in order to win their engagement,” said Nick Cicero, VP of strategy at Conviva.

Parks: Consumer Adoption of Smart-TVs Rose to 56% During Pandemic

The pandemic has been a boon for connected consumer electronics. New data from Parks Associations finds that among the most commonly adopted CE device categories, smart-TVs and smart speakers/displays showed significant growth during the COVID-19 pandemic. Smart-TVs reached 56% while smart-speakers/displays reached 53%.

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Citing recent announcements by Amazon and Comcast regarding branded smart TVs, Paul Erickson, senior analyst at Parks, says TVs are now consumers’ most common video centerpiece in the home, and technology powerhouses are vying to own this point of entertainment aggregation — and the data that goes with it — by controlling the platform itself.

“The competition now is not just about providing access to entertainment, it’s also about adding increasing value to the platform through features such as voice assistants, smart home integration, and better user experiences,” Erickson said in a statement. “Smart TVs are now seen as a key anchor device for ecosystem penetration into today’s broadband households.”

Parks contends that purchase intentions were elevated at the beginning of the year for a variety of entertainment and productivity devices due to increased time spent at home.

Indeed, first-quarter purchase intentions are often low due to seasonality. However, the pandemic grew consumers’ perceived value of connected entertainment devices, generating growth in future purchase intentions for all product categories related to connected home entertainment.

“Consumer electronics device manufacturers are best served by product strategies accounting for consumers’ increased use of devices at home for work and streaming entertainment purposes,” Erickson said. “While mobility remains important, consumers now see renewed value in at-home work and lifestyle use cases.”

Parks: Video Streamers Love Broader Content Offerings

The proliferation of over-the-top video services caters to niche audiences, correct? Not so much.

New survey data from Parks Associates finds that U.S. broadband households, who despite favoring at least one particular type of content genre, spend 70% of their streaming time on average on services with a broad variety of content, such as Netflix, Tubi or AMC+. Specifically, 44% of 5,000 respondents spend 76% or more of their streaming time on broad-based services, while 48% spend 25% or less on niche services.

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“Services offering a variety of content categories are the foundation of consumers’ video service ensembles,” senior analyst Paul Erickson said in a statement.

Erickson contends that despite niche services such as Shudder, Britbox and Crunchyroll dedicated to horror, British, and anime content, general entertainment platforms rule the conversation.

“[Niche services] are unlikely to be the primary, foundational content source within a household,” he said.

Ad-based services in particular have broadened their market appeal over the past few years by incorporating different genre categories. Crackle has made significant additions to its nonfiction content, Pluto TV has added several sports channels, and Tubi TV highlights children’s programming with its “Tubi Kids” section, according to Parks.

“If services are to challenge Netflix, Amazon Prime Video and Hulu, they need to feature a variety of programming across genres,” Erickson said. “We will see more bundling services emerge like AMC, which bundled together its niche services Shudder, Sundance Now, and IFC Films under the AMC+ service umbrella in order to give viewers more options.”

The research also finds that while “content is king,” cost is still the leading factor when consumers choose an OTT service. Fifty percent of respondents cite service cost as a key determination in the services that they use to access online video content. In response, key services have experimented with diversified pricing options. Disney+ has introduced transactional purchases, while Peacock is incorporating an AVOD option, and HBO Max and Paramount+ offer less-expensive ad-supported tiers.

“A hybrid pricing approach meets consumers where they are,” Erickson said. “Maximizing revenue potential with hybrid pricing will help services finance the growing cost of content library growth.”

Parks: More Than 50% of Households Combine Netflix, Amazon Prime Video or Hulu With Fourth OTT Video Service

New consumer data from Parks Associates finds that 54% of U.S. broadband households combine Netflix, Amazon Prime Video or Hulu with at least one other subscription video service.

Currently, 82% of U.S. broadband households subscribe to an OTT service, and OTT service stacking has grown exponentially as new services such as Paramount+ launch, according to the Dallas-based research firm. As cord-cutters migrate away from traditional pay-TV, they increasingly seek video service offerings that more closely meet their content needs, with the added value of lower cost and flexible use cases.

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Parks notes that cord cutters used to spend $117 per month on pay-TV services and are now paying $85 per month for OTT video services.

“Subscription fatigue and ad intolerance are pervasive in the streaming industry, and consumers are becoming more selective about where they spend their time and money,” said Lexie Knauer, senior product marketing manager at Brightcove, which contributed to the report. “It’s important for streaming services to go to market with a strong acquisition strategy to clearly promote the value of their content across the right channels and ultimately capture their target audience.”

Michael Ribero, chief subscription officer with The Washington Post, said increased SVOD service stacking underscores the fact that no one service satisfy all consumers.

“I think this [data] helps services with a clear identity, while others will need to clarify how they fit into the customer’s bundle,” Ribero said. “And I believe this has downstream ramifications especially for discovering new shows and content.”

Parks: U.S. Streaming Video Subscriptions to Reach 277 Million by 2026

Parks Associates Aug. 24 announced that the number of over-the-top video subscriptions in the U.S. will increase from nearly 230 million in 2021 to more than 277 million in 2026, an increase of more than 20% in five years.

Citing internal research, Dallas-based Parks said that 80% of millennials and Gen-Z survey respondents said they stream video on more than one platform at least monthly.

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Parks said that in Q1 2021, the average OTT subscription in domestic broadband households was roughly 2.5 years and had a strong correlation with age. Subscription lengths for younger consumers are much shorter than for older consumers. Older consumers subscribe to fewer services, but keep them for a longer period. By contrast, younger consumers may subscribe to a larger number of services but are more likely to churn through them.

“The delivery and digestion of streamed content market is heavily influenced by the ability to attract and retain viewers,” David Palmer, president of Everise, which contributed to the report, said in a statement.

Palmer said media companies should consider a myriad of preferences and consumer behaviors, including age, viewing habits, interests, available time and platform preference, among others.

“The emergence of multiplatform viewing further drives the need for these brands to protect both themselves and their customers with a multichannel content moderation and omnichannel support strategy,” said Palmer.

Competitiveness between OTT video and other forms of entertainment will continue to increase with a larger share of consumers’ time going toward socialization, in-person, recreation, vacation and events, according to Parks.

“Brands can leverage new engagement data to help design new services and improve their customer support and retention strategies, offering value to consumers both at-home on different platforms and on-the-go,” added Parks senior analyst Kristen Hanich.