Overall, 69% of US broadband households subscribe to at least one OTT video service.
“Not only are more households subscribing to OTT video services than ever before, but also the average number of subscriptions per household is increasing as well,” said Brett Sappington, senior director of research, Parks Associates. “The OTT video pie is getting bigger, and it is getting deeper as well.”
He added: “What we are seeing is consumers adding to the number of sources that they use to access interesting content. This growth is critical. It means that video services do not necessarily have to displace a Netflix or other large service in order to gain market share. Services can potentially find success as a complementary offering as well.”
A common assumption is that consumers who pay for multiple subscription OTT video services would not need to, or have time to, use free OTT video service options. Yet, the research found the opposite to be the case. Only 30% of households subscribing to one subscription service use at least one free, ad-supported online video service; that number jumps to 47% of households subscribing to three subscription services and 63% if a household subscribes to five or more services.
The bad news is that with the exception of Netflix and Amazon Prime, OTT services are experiencing churn rates exceeding 50% of their subscriber base.