Just 5% of US internet household have a pay-TV service alone, leading Parks Associates to conclude that pay-TV companies are continuing to shed subscribers to the streamers.
However, the analyst adds that the average annualized industry churn rate for streaming services is 50%, indicating many streaming services are also struggling to keep their customers.
“65% of internet households have a smart TV,” said Eric Sorensen, Director, Streaming Video Tracker, Parks Associates. “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, so in 2024, we will see increased consolidation, mergers, and acquisitions as all providers must find ways to innovate alongside the greater emphasis on profitability.”
In the United States, telcos are exploring new ways to get their products in front of customers that prefer steaning services. Cox is trialling Neighborhood TV, a hyperlocal streaming service designed to act as a gateway to attract consumers to its phone, internet, and TV bundle. Station groups such as Sinclair and Hearst have also launched local streaming services.
“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—for example, LG will be displaying its MyView smart monitors at CES 2024, which the company designed to deliver a personalized experience to the user.”
The research firm will host the 18th annual Connections Summit: Performance and Profits: Smart Home Strategies’ at CES on January 9, 2024, at the Venetian, Level 4, Marcello 4404, Las Vegas.
