It’s no secret that heritage MVPDs offering cable television service packages to customers continue to lose subscribers to streaming video services. But, just how many internet households have only a pay-TV service and don’t use a streaming platform?
Very, very few of them, a newly released study from Parks Associates finds.
Parks Associates’ latest update of the firm’s Streaming Video Tracker reveals that just 5% of U.S. internet households have only a pay-TV service.
While that may be wholly unsurprising for some, Parks points to another statistic — the average annualized industry churn rate for streaming services is 50%.
This, Parks says, means many streaming services are also struggling to keep their customers.
Could “FAST” channels be impacting both OTT and cable TV consumption?
“Sixty-five percent of internet households have a Smart TV,” said Eric Sorensen, Parks Associates’ Director of its Streaming Video Tracker. “This platform interface serves as the entry point for many households to their content services. Competition for attention is extreme, while the continued rollout of the ATSC 3.0 standard gives viewers even more options.”
As such, 2024 will yield “increased consolidation, mergers, and acquisitions as all providers must find ways to innovate alongside the greater emphasis on profitability.”
One way MVPDs are rethinking how to serve their customers is through hyperlocal content. Parks points to Cox Media Group’s Neighborhood TV hyperlocal streaming service, presently in the Atlanta area, as a way to expand its influences in its communities and as a gateway to attract consumers to its phone, internet, and TV bundle. Parks also notes how station groups such as Sinclair and Hearst Television have also launched local streaming services “to leverage the consumer desire for local content in this age of streaming.”
“The hyperlocal approach clearly attracts interest from consumers,” Sorensen said. “With the increase of AVOD business models, consumer adoption indicates that relevance is a key factor, namely consumers are likely to turn off services if the service and messaging are repetitive and irrelevant to them.”
Even manufacturers recognize the need for personalization. At CES 2024, which begins next week, LG will be displaying its MyView smart monitors. Sorenson points out that the company “designed to deliver a personalized experience to the user” with these new products.
Parks Associates will host the 18th annual CONNECTIONS™ Summit: Performance and Profits: Smart Home Strategies at CES on January 9 at the Venetian, Level 4, Marcello 4404, from 9:00 AM- 5:00 PM local time in Las Vegas. CONNECTIONS Summit features six executive sessions and a fireside chat on “Smart Home Innovations” with Mark Benson, Head of Samsung SmartThings U.S., Samsung SmartThings. CONNECTIONS Summit concludes with a networking reception sponsored by Cox Communities.
