Providing market intelligence for more than 35 years


Navigating the Evolution of Video Entertainment

The video entertainment market is in a perpetual state of flux. The disruption that early streaming services Netflix and Hulu brought to the market continues to be a source of change. Traditional pay-TV providers have suffered a dramatic loss in subscriptions within the last ten years as streaming services became more popular among consumers. That popularity led to an explosion of new entrants into the streaming market and forced legacy pay-TV providers to evolve their services or risk losing more business.

Today, the video entertainment market is drastically different than it was five years ago, will continue to evolve, and is already restructuring again. Advertisements, for example, are experiencing a revival as prices for ad-free tiers rise relentlessly and profitability becomes more of a concern.

Streaming pay-TV, or virtual multichannel video programming distributors (vMVPD), like YouTubeTV are streaming services employing both subscription and advertising business models. Parks Associates data shows relatively low churn rates for streaming pay-TV and high user satisfaction. Parks Associates data also finds that 56% of US internet households subscribe to a pay-tv service, down from 73% in 2020, but the percentage of households now streaming a pay-TV service has doubled in the past 3 years.

Parks Associates - Pay-TV adoption by service type

The rise of streaming pay-TV and free ad-supported television (FAST) channels demonstrates how consumers still value the linear model. Legacy pay-TV may show a decline overall but is still an important piece of a household’s entertainment setup.

Streaming pay-TV in particular is a category to watch. As the chart above shows, while legacy pay-TV subscriptions declined, streaming pay-TV services rose. Households may be cutting the cord but are not ready to abandon pay-TV altogether. With no contracts or hardware required from most providers, consumers are less resistant to signing up for a streaming pay-TV service, versus a traditional pay-TV service.

The above insights are just one of many included in Parks Associates’ recent report, Video Services: Shifting Demand, which reveals how the video landscape has changed in recent years and is changing again. The report includes historical data on adoption, satisfaction, and churn for pay-TV and streaming video services, including vMVPD services. The video market is at the mercy of consumer choice, but the data revealed in this report can inform businesses about where consumers are choosing to spend their time and money so they can adapt successfully in this highly competitive market.

Parks Associates will be sharing more research and insight into the video entertainment markets at Future of Video, Nov 14-16, at the Marina del Rey Marriott in California. Register Now.

More from Sarah Lee

February 07, 2024

Fox, Warner Bros. Discovery, and Disney Join Forces to Revolutionize Sports Streaming Landscape

Fox CEO Lachlan Murdoch announced a joint venture in streaming sports with Warner Bros. Discovery an...

Read More

March 21, 2023

“Friday Night Baseball” Returns on Apple TV+ for the 2023 MLB Season

Today Apple announced the return of “Friday Night Baseball” on Apple TV+ for the 2023 season and is...

Read More

February 21, 2023

The Cost to Streaming Services of Password/Account Sharing

Parks Associates 2022 consumer survey research finds 40% of consumers in US internet households shar...

Read More