Linear TV’s dominance fades as online sources rise
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Michelle Clancy
| 31 August 2019

The average consumer now accesses TV shows and films from more than four different sources of content.

According to Hub Research’s Decoding the Default study, ease of navigation and favourite show availability drive consumers’ TV default decisions—and will in large part determine the success of both new and existing services.

Three additional factors also play a strong role: Access to live programming, strong content variety and the ease of binge viewing.

The study found however that right now, no service is best at delivering all these needs. In fact, each source offers a distinctly different set of benefits. Traditional pay TV subscriptions for instance offer access to live programming, while Netflix is bolstered by a lack of commercials. Hulu offers access to the latest shows; and Amazon wins on variety.

For the first time, an online TV source is statistically as likely to be consumers’ default as a source from a pay-TV provider. The report found that 47% of viewers default to TV viewing through their pay TV set-top box, while 45% default to an online source.

Traditional TV appears to be on the wane: The pay TV set-top box has dropped 7 points as a default in just the past year, while online sources have increased 7 points. Linear viewing from a cable, satellite or telco TV subscription has reached its lowest level as a default source of TV.

Only one-third of TV consumers say the first thing they turn on when they want to watch is linear TV from their traditional pay TV service – shows and films airing on their regularly scheduled time and network. In fact, the percent defaulting to linear TV has dropped 14 percentage points in just three years.

Looking at the soon-to-launch sources, Disney+ already has an edge as a potential default source, with many feeling it will offer strong value for the money. Majorities of consumers with kids 12 or younger—as well as a majority of current Netflix subscribers, with or without kids – rate the proposed service and its $6.99 monthly price tag as an excellent or good value.

“With its low monthly price point and proposed variety of content, it’s not surprising that consumers in Disney+’s crosshairs—households with kids and Netflix subscribers—see it as offering strong value for the money,” said Peter Fondulas, principal at Hub and co-author of the study. “Whether its value proposition is strong enough to make Disney+ viewers’ first stop for TV is of course yet to be seen. But by bundling Disney+ with Hulu and ESPN+, the combined package stands to tick off many of the boxes consumers consider must-haves for a default service.”

Hub’s survey was conducted in August among 1,678 US consumers with broadband, who watch at least one hour of TV per week.