M&E Journal – Consumers choosing to shave all or some of their pay-TV expenses are not always responding to price sensitivity. They may be reallocating their entertainment spend for what they perceive as a higher value alternative, in this case, OTT streaming services. OTT provides on-demand streaming services which deliver film and television content via the Internet, without the need for traditional cable or satellite TV subscriptions.
The average US cable bill cost viewers $99.10 per month in 2014, according to the Leichtman Research Group, whereas the average monthly Netflix, Hulu Plus and Amazon Prime subscription fees are $8.99, $7.99 and $8.25, respectively. In our survey, 78 per-cent of respondents subscribed to at least one streaming service, and, of those who subscribed to pay-TV, 70 percent also subscribed to at least one streaming service. OTT’s consumer value proposition appears to be both compelling and sustainable, as the number of OTT services and subscribers is expected to grow in 2016.