It's that time again when Digitalsmiths put out the quarterly Video Discovery Trends report which looks mostly at pay-TV trends but also includes some interesting OTT, VOD and SVOD trends as well. Generally I pass over that first part and head deep into the second as that's all streaming video. There is, as always, a link to the full report for you though.
Pay-TV companies did not really get how people discovered content for a long time, they might not quite get it now. But they are trying and that shows in the report where almost half of the respondents felt it is easy to find a movie in their pay-TV VOD catalog. A marked improvement to say the least. Are you buying VOD movies are are you still on the SVOD path with your favorite online movie subscription service?
As always, it is important to know how the data is collected so you know how it might be presented.
- Survey Size: Over 3,140 Consumers
- Geographic Regions: United States, Canada
- Ages of Respondents: 18+ Years of Age
This survey was conducted by a leading third-party survey service. The results were analyzed by Digitalsmiths. That's all we get in terms of demographics. No break downs by age group etc. (a note for them for future reports, it would be nice to see).
Digitalsmiths might call their quarterly report Video Discovery Trends, but it goes well beyond all that and is usually quite interesting to peruse and write up. The Q4 2013 edition is no less so. While I generally breeze over some things like plans to change providers (6.8%), bill amounts (43.2% are paying more) totaling more than $100 (58.2%), no premium channel subscriptions (62.4%) and did not add services in the quarter (64.8%), they are all important metrics these days as TV and online video continue to slowly merge like to spiral galaxies coalescing into one massive supergalaxy. Live TV is also pretty low these days according to the report with 49.8% of respondents watching 2 hours or less per day (hypothetically, 23.8% could be watching none based on how the results are presented as the category is "less than an hour").
Over-the-top is what we generally like to look at here as it's the convergence point between TV/film and online. There's a lot of ads being shown against this content so it's always good to get a view of who is paying to watch and what they are watching. it will come as no surprise that Netflix is leading the subscription service category with 39% of respondents saying they use them. It's also still crushing the competition with Amazon Prime streaming coming in second at just 11.6% and the big broadcast-owned Hulu Plus at just 7.7%.
Amazing that Hulu shows billions and billions of ads each month and they have such a tiny little section of the market, isn't it? After them is Redbox Instant which is still in its infancy but has 2.6%, topping Blockbuster with just 1.4%.
Over one-third of respondents are paying $6-8 a month meaning they are subscribing to just one of the services and it's a good bet that a lot of them are Netflix subscribers. Just 6.5% are paying less than that. But there's also very little overlap in the services it seems as 19.6% say they pay $9-11 a month and then it's all single digits. If you take $8 for Netflix and $8 for Hulu plus it's in the $16 range and that nabbed just 7.7% of respondents, which, probably not coincidentally, is the exact percentage of Hulu Plus users in the survey.
On the PPV side of things, Redbox kiosks are king with 17.3% and Amazon is second with half that (8.5%). iTunes has a lowly 6.4% and YouTube paid, which amazes me that anyone found it, has 1.5% just edging past Wal-Mart's Vudu which is at 1.4%. In last and not lumped into "other" was Best Buy's CinemaNow. I suspect that the Vudu and CinemaNow users are most likely game console or OTT set-top box owners.
Again, a lot of the money being spent here is in the lower per-month range. Almost 60% are spending $8 or less per month (57.4%). Nearly 10% spend in the $9-11 range and then it dwindles fairly rapidly. Given a $2-3 price point for a rental that boils down to 3-5 rentals a month, give or take, as most common.
Here's the part where I try to tell the pay-TV people that they need to give their full attention. The question was posed thusly:
Why do you use these 3rd-party rental and/or monthly subscription services like Amazon, iTunes, Netflix, Vudu, CinemaNow, Blockbuster, Redbox, YouTube? (choose all that apply):
The responses are, as expected. Again almost 60% flat out stated convenience (59.2%) and 50.1% said that it's cheaper. Almost 40% said they use them so they can watch certain shows or full seasons which goes along with the 35.6% that cited better selection. Since the report was all about discovery, it's interesting to note that just under 30% said that it's easier to find what they are looking for. Showing the rise of the Millennials, 21.4% said it's due to them being able to watch on a tablet, 13.1% said no cable/satellite and 12.7% wanted to watch on smartphones.
TV Everywhere Lost in the Shuffle
Clearly when asked about TV Everywhere, there's a lack of consumer education because 52.4% don't know if their provider offers it. Interestingly, they didn't even use the term TV Everywhere in the question.
Does your cable/satellite provider offer an app(s) that allows you to watch TV/movies on devices such as a smartphone or an iPad/tablet?
So it's clearly not a lack of understanding the terminology as much as knowing if they have access. Over one-third did say yes to the question. Of course that's counter balanced by 66.8% who don't have their provider's app installed on a smartphone or tablet. Only 7.7% use the app daily, and 12% use it once a week.
So awareness is steady says Digitalsmiths, but usage isn't really growing. Seems like the pay-TV people could work on showing those customers the benefits of TV Everywhere, unless, of course, they don't want them using the bandwidth or the app, which may very well be the case.