Consumer Analytics

Video Spending & Consumption Disparities a Challenge for Pay-TV Providers

by Parks Associates | May. 1, 2015

While the typical monthly bill for pay TV is the equivalent of a nice dinner for two on the town, the typical bill from an over-the-top provider is more like a delivery pizza on special. Such a big price difference is fine, so long as people perceive an equally big difference in quality.

Data suggests that for many people, this is in fact the case. A video Purist for example (defined by Parks Associates' video segmentation) will spend 88% of their money on pay-TV services and 88% of their time watching pay-TV services. However, for other segments, spending and consumption levels are far out of alignment. Multiscreeners, for example, spend 66% of their money on pay-TV services, but 60% of their time watching OTT services.

Such an imbalance presents a challenge to pay-TV providers because it gives consumers an obvious incentive to rebalance their video portfolio and shift spending from pay-TV services to over-the-top sources. Put plainly, these are the segments most in danger of cord-cutting and shaving—food for thought for service providers when they are developing new service packages and aiming to hold onto their existing subscribers.

 

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Fast Facts  |  In The U.S.

CONNECTED DEVICES

Since 2009, desktop adoption has declined from 90% to 69% of broadband households, while tablet adoption increased from 7% to 63% and smartphone adoption increased from 36% to 78%.

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6% of broadband households currently own a smart watch.

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Among those 18-24 with an OTT subscription, 22% report that someone outside of their household actually pays for the service.

   

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About Parks Associates

Parks Associates is an internationally recognized market research and consulting company specializing in emerging consumer technology products and services. Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, primary studies, consumer research, custom research, workshops, executive conferences, and annual service subscriptions.

The company's expertise includes new media, digital entertainment and gaming, home networks, Internet and television services, digital health, mobile applications and services, consumer electronics, energy management, and home control systems and security.

Each year, Parks Associates hosts industry webcasts, the CONNECTIONS™ Conference Series, and Smart Energy Summit: Engaging the Consumer.

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