Report: OTT Has Caught Up to Cable

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NEW YORK: New research from Clearleap, which delivers multiplatform solutions to content owners, reports that "Millennials are leading the OTT revolution, leaving cable behind," with more than 70 percent of that demo using streaming services and just 64 percent having a cable subscription.

Of all respondents, 78.85 percent reported currently subscribing to cable, and 71.37 percent confirmed that they use a streaming service. OTT penetration tops cable among the 18 to 29 set. Of that demo, some 26 percent have never subscribed to cable.

When current streaming service users were asked what they would be willing to spend on a service that featured their three preferred types of content, 42.66 percent indicated that they would pay $10 to $25 per month.

Netflix leads in terms of market share—83.47 percent have a subscription to the service, compared with 38.23 percent for Amazon and 22.37 percent for Hulu.

The Clearleap survey also found that respondents were generally happier with their OTT service than they were with cable providers. Almost 48 percent of cable subscribers surveyed said they had considered canceling the service citing high costs (34.14 percent), poor customer experience (7.52 percent) and not having enough time to watch TV (2.55 percent). Only 3.36 percent indicated that they would cancel their subscription because they had signed up for a streaming service.

For streaming customers, 62.76 percent said they "love" their service and wouldn't cancel. Additionally, 11.73 percent shared that they wouldn’t cancel because the subscription does not belong to them.

The key factors in choosing a streaming service were content (23.58 percent) and price (22.72 percent). The biggest frustration: the content subscribers want not being available.

Clearleap asked respondents who currently subscribe to an OTT operator to select three types of content their ideal streaming platform would have. These included movies (67.13 percent), premium channels like HBO or Showtime (47.73 percent), major broadcast networks (41.26 percent) and cable channels (40.73 percent). Only 28.15 percent put sports in their top three.

For those who don't yet have an OTT subscription, preferred content was again topped by movies (52.51 percent), followed by major broadcast networks (43.38 percent), premium channels (39.04 percent) and cable channels (36.99 percent).

"Going OTT isn’t an option anymore—it’s a mandate," the report says. "To stay relevant, reach audiences and grow revenue, content providers need to not only provide a streaming option to consumers, but also address the unique behaviors of today’s younger television viewers."

To be successful, the report continues, OTT providers should ensure good value; make it easy to browse, discover new content and channel surf; optimize screen size, especially on mobile; and offer tiered pricing to encompass viewing on multiple devices at the same time, given the number of people sharing login details. The report also points to a gap in live-streaming OTT options. "Content owners should capitalize on the white space by investing in live content that isn’t already easily accessible online."