Households Upping SVOD Services

NEWS ANALYSIS – One of the hallmarks of over-the-top video has been the distribution channel’s ability to offer myriad programming at loss-leader pricing.

Thus, it’s little surprise the average broadband home in the United States subscribes to 2.8 OTT services – spearheaded by Netflix, Amazon Prime Video and Hulu – according to new data from Ampere Analysis. The global average is two SVOD services per household.

Through the first quarter of the year, monthly domestic household SVOD spending reached $35 – more than double the $15.60 spent in the previous-year period.

With Netflix and Prime Video driving global SVOD growth, monthly household SVOD spending the United Kingdom reached $18.70 compared to $10.40 last year.

“Netflix and Amazon have acted as catalysts for SVOD stacking, particularly in those European markets where they have seized the initiative through low cost subscriptions,” Toby Holleran, senior analyst at Ampere Analysis, said in a statement.

Indeed, French and Spanish households now average 1.5 and two SVOD services per household, respectively, despite the recent exit of CanalPlay from the French market.

“While some European countries have been slower to adopt SVOD, the American giants are now part of the package in virtually every SVOD household,” said Holleran. “This is particularly notable in Holland, where nearly three in four SVOD households take only Netflix.”

Ampere contends that while OTT video continues to rise in popularity, demand for traditional pay-TV remains relatively strong in some countries. Household SVOD penetration in the U.K. increased 4%, while pay-TV adoption remained unchanged.

Indeed, in Poland where pay-TV is relatively inexpensive, OTT video continues to struggle gaining traction among consumers.

“Although in some cases a growing number of SVOD subscriptions is leading to a decline in pay-TV, that is certainly not always the case,” said Tony Maroulis, research manager at Ampere. “Heavy stackers are most likely to have pay-TV services. Clearly, there’s a healthy appetite amongst consumers worldwide for quality content across a range of paid-for platforms.”