While 86% of U.S. homes still subscribe to some form of a multi-channel video service, a sizable chunk of the group that does not is pushing some hard earned cash toward one of three over-the-top providers, Leichtman Research Group found in a recent survey of 1,219 homes.
Among homes that don’t get a traditional video subscription, 40% get Netflix, 11% are Amazon Prime subs, and 7% pony up for Hulu Plus, LRG said. In total, 42% of non multi-channel subs get at least one of those services, LRG said in its eleventh annual study on the topic.
Overall, LRG noted, 8% of all TV homes are watching over-the-air broadcast TV only, versus 10% in 2010, with 6% watching a combination of OTA and OTT programming. That group includes about 1% of all homes that do not subscribe to a multi-channel video service primarily because they can catch all they want via the Internet or Netflix, the firm added.
As a point of comparison, a recent study by GfK found that 19.3% of homes rely exclusively on over-the-air television.
Also of note: While major multi-channel video providers reported a cumulative increase of less than 1% of subscribers over the past three years, penetration has declined slightly over that period due to a larger increase in the number of rental housing units, LRG found, noting that multi-channel penetration essentially peaked at 88% in 2010 following the digital transition.
Among other findings:
- Nationwide, 20% of TV homes with annual incomes of less than $50,000 are non-subscribers, versus 9% among homes with incomes of greater than $50,000.
- The mean reported monthly spending on multi-channel video service is $83.25, up 5.9% from last year.
“While some consumers continue to go in and out of the category, economic factors appear to be as strong a force in shaping this market as the emergence of over-the-top alternatives alone,” “Bruce Leichtman, president and principal analyst for LRG, said in a statement.