The Rise of the Multi-Service Subscriber – Transforming The Video Business

There's been much talk of increased competition in the TV landscape in recent years. Nowhere is that competition fiercer than between over-the-top (OTT) services. This is no surprise: Consumers today can choose from among a plethora of services offering content anytime on any device.

By David George, Senior Vice President, North America 

This choice doesn’t seem to translate to healthy competition, however. If the OTT market were competitive, we’d have seen a decline in Netflix’s growth as well as in new competitors. Yet, in Q4 2017, Netflix boasted an all-time high in subscriber growth, attracting 3.8 million new streaming subs. This exceeded Wall Street forecasts and netted big price gains in Netflix stock.    

Meanwhile, new players emerge in the market every year. These include other pure OTT providers as well as OTT services branching out from traditional broadcasters. There’s also enough market share to foster healthy competition. With so many consumers worldwide, there must be something more to it.

The simple truth? We are witnessing the rise of the multi-service consumer.

There has been steady growth in the number of consumers using 2, 3 or more subscription OTT services. In many cases, a consumer turns to each service to fill a specific content niche. One service may be better for films, while another offers a favorite TV drama.

Because OTT services have a low price-point compared with pay TV offerings, consumers are happier to sign up for more than one. I think this trend will continue. Customer satisfaction is much higher for OTT services than their traditional counterparts. As a result, we’ll see consumers willing to increase their spending on video consumption. This will manifest in two ways: video consumers will continue to add new services and service providers will continue to add value to their user experiences, justifying higher rates.

The next step in the journey of the multi-service subscriber is to find providers capable of aggregating these offerings into a simple, easy-to-access location and video experience.

I would be interested to hear your views on the topic and if you are attending the NAB Show next month, let’s meet at the Accedo stand SU9401CM, Upper South Hall and discuss further. You can choose a date and time HERE.

You may also want to join me on April 11th at 9:40 am, when I will be presenting “Why multiscreen needs to translate to multiple consumers” at the Broadcast Engineering and Information Technology Conference. located in the North Hall Meeting Rooms – N255.