Millennials May Opt for OTT Over Pay-TV Services

PLANO: New research from The Diffusion Group (TDG) finds that younger consumers are less likely than their older counterparts to subscribe to legacy pay-TV services, opting instead for the likes of Netflix or Hulu Plus.

TDG’s Late Millennials: A Study in Media Behavior surveyed a random sampling of more than 2,000 broadband users between the ages of 18 and 24, half of which were living at home with their parents. Of this latter group, 49 percent said they were highly inclined to sign up for an online subscription video service once they moved out on their own, compared to 31 percent that were highly inclined to sign up for a traditional pay-TV service when they set up their own households. This is a difference of 58 percent.

“Much has been said about younger adults and the choices they may make about their home TV services once they leave their parents’ home,” said Michael Greeson, the president and principal analyst for TDG. “Yet little research has been offered up to support the various hypotheses.” TDG’s new research, according to Greeson, makes it clear that tomorrow’s head-of-household is less favorably disposed than their predecessors toward legacy services and more favorably disposed toward OTT TV services.

Greeson admits these dispositions could change over time if OTT TV services are unable to acquire the content these consumers will want as they marry, have children, and move up the career ladder. “In the end, it will still be less about the conduit and more about the content and value the service provides.”

“While this data can be spun to rationalize a number of arguments, the simplest insight may be the most profound,” noted Greeson. “The very fact that young consumers perceive online video services as somehow more desirable or necessary than incumbent pay-TV services says volumes about the future of video.”