OTT availability threatens free, live TV as consumers' favourite choice



| 18 August 2015

On topic research from Futuresource Consulting has found that free and live TV are still the favourite choices of consumers, but over-the-top (OTT) services are becoming more popular and widely used, fuelled by their wider availability.

Futuresource's Living with Digital report identified live TV — regardless of whether paid for or free — is still the primary viewing choice for almost two-thirds of respondents across the territories. France hit a rate of three-quarters compared with 59% in both the US and UK.

Although cost was cited as the primary or secondary reason for respondents dropping pay-TV services across all territories — indicative, said Futuresource, of alternative content sources — respondents also showed continued allegiance to premium tier pay-TV subscriptions, with over a third of pay-TV respondents taking film packages and over two-fifths taking sports in general, as much as 57% in the US.

Alarmingly for the pay-TV industry, the analyst suggested that OTT services were coming of age. Evidence of this was that 40% and 20% of US and UK respondents respectively took Netflix. In addition, the analyst noted that Amazon Prime Instant Video was also seeing continued rise with 23% of US and 10% of UK respondents taking the service. In the UK 20% of Prime subscribers signed up primarily for the video service.

Futuresource also found that connected TV was increasingly established, with a third of all respondents signifying such a service and just over two-thirds accessing music or video entertainment services at least once a week, up from 63% in the previous wave. Interestingly, said the analyst, 30% of US connected TV owners also accessed services on their set every day.

Video dominated the market in relation to connected TV and content consumption, with 83% consuming all video content formats, up from 80% previously. Half of 16-25-year-olds had subscription video-on-demand both (SVOD) online and through connected TV apps.

"DMA ownership has almost doubled across the US and the European countries sampled. In terms of total DMA ownership, 15% of the total respondents, one in four 26-35-year-olds and one-third of Netflix subscribers have a DMA integrated into their devices," said David Sidebottom, principal entertainment analyst at Futuresource. "Google Chromecast in particular has stimulated growth across all markets covered, having a DMA ownership share of 30%. 62% of DMA users watch paid-for video on them (76% in the USA) and 80% use them at least once a week, a quarter every day."