Streaming on the rise, but no nail in cable's coffin

Michelle Clancy ©RapidTVNews | 30-09-2011

More than a third of Americans use Netflix at least once a month, signalling that online streaming has transformed the television viewing habits of millions of US consumers. However, don't think that's a death knell for traditional TV just quite yet.
New research into over-the-top (OTT) video viewing from Knowledge Networks shows that regular Netflix subscribers, on average, watch five TV shows and four movies per week via the streaming or DVD-rental aspects of the service; however, only 20% of Netflix streaming users are watching cable VOD less because of their Netflix viewing.
And, a tenth of Netflix subscribers said they were "very likely" to cancel the OTT service if their cable or satellite provider began to offer a similar service at a similar price.
Still, Netflix' impact is noticeable: a full 35% of all U.S. consumers (ages 13 to 54) say they use Netflix at least once a month.
"Netflix has made remarkable in-roads, bringing streaming video and other alternative viewing options to a mass audience," said David Tice, vice president and group account director for media at Knowledge Networks.
"At present, Netflix has a dominant market position in this space -- but cable video on demand (VOD) and other video services are widely available and poised to act as alternatives. Netflix needs to use its remarkable platform to build deeper customer relationships, differentiating itself by offering benefits that speak to subscribers' desire for control, comfort, and convenience."
The research also suggests that Netflix' strategy of integrating with devices that consumers are likely to already have plugged into the television is working. When it comes to how Netflix is consumed, videogame systems (62%) are by far the most popular gateway for "Watch Instantly" content on a TV set; other options -- like Internet-connected Blu-ray players and Roku boxes -- are used by 15% or fewer of viewers.