The number of streaming video services used by U.S. consumers has reached double digits for the first time since TiVo began tracking this metric 11 years ago.
TiVo’s newest Video Trends Report finds consumers accessed 11.6 video services in the fourth quarter, ended Dec. 31, 2022. That’s up from 8.9 streaming services a year ago and 9.9 in Q2 2022. TiVo found service growth is occurring despite decreasing demand for subscription video on demand (SVOD). The found that 26.6% of survey respondents dropped an SVOD service over the last six months, up more than 8% year over year. Streaming video service growth is being driven by ad-supported video on demand (AVOD) and free ad-supported streaming TV (FAST).
The current economic climate and concerns over inflation are impacting consumer spend, forcing people to reconsider the number of services they pay for each month and opt-in to free and ad-supported choices, according to TiVo. The adoption of free video services, including AVOD and FAST, has grown by almost 70% year over year — reflecting that these services continue to capture a greater share of the market.
TiVo suggests 64% of consumers now utilize at least one AVOD or FAST service, driven largely by millennial audiences, up from 60% year over year. The number of choices continues to benefit consumers, but has also led to content discovery becoming even more complex and varied. People still mostly rely on commercials and word of mouth to inform them of other TV shows and movies they’d like, according to the report.
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“We’re at an inflection point in the digital entertainment industry as consumers seek to take advantage of the flood of content choices and service types available but now wrestle with the paradox of choice,” Scott Maddux, VP of global content strategy and business at Xperi, parent to TiVo, said in a statement.
Additional report findings include that more than half of respondents (53%) prefer when the whole season of a TV show is available at once, compared to only 24.7% who prefer episodes to be released one per week. During Q4 there was a strong difference among men and women in consuming content, with women reporting a strong preference for the opportunity to binge a whole season (61%), whereas men report a stronger preference for the weekly release schedule (60%).
When examining the increase of video services, there are some glaring differences among service consumption when it comes to age groups. Millennial respondents consumed significantly more than any other age group with an average of 16.3 sources, compared with Gen Z with 12.7 sources and Gen X with 12.2 sources.
In recent months, respondents appear to be evaluating and adjusting their entertainment spending more often, with around 18% saying they currently do so every month or more compared to only 13% a year ago.
While the recent pattern of economic inflation has caused 30% of respondents to reduce their overall entertainment spending, almost three-quarters of respondents (74%) say they’re slightly or much more likely to look for entertainment at home than going out. To support this at-home entertainment, these respondents are investing in their home set-up with one-third purchasing a new TV in the last six months.