You might not be too surprised if a survey finds 19 percent of respondents to a survey on video entertainment usage say they cut linear video service within the last year. You might be more surprised to learn that nearly 39 percent have never purchased a linear video service.
That suggests the long term problem linear video providers face: there is dwindling demand for the current product, as well as the near term problem, namely churn and abandonment.
The survey of 3150 consumers on behalf of Digitalsmiths in the United States and Canada, sponsored by Digitalsmiths, also found churn behavior increasing. In the third quarter of 2015, eight percent of respondents said they had switched service providers in the last three months, about a 2.7 percent monthly rate, and higher than most major triple play providers have been reporting.
Asked what they might do over the next six months, 46.5 percent of respondents said they would either cut linear service altogether (4.8 percent), change to another linear provider (7.2 percent), switch to an online app or rental service (2.7 percent). Some 32 percent said they “might” change services.
The survey found 82.5 percent of respondents watch between one and 10 channels, an increase of 2.1 percent year over year and 2.3 percent over two years. That is generally consistent with historical findings, but shows a slight increase over time as more channels have been added to channel lineups.
Respondents who watch 11 or more channels decreased 2.1 percent year over year and decreased 2.3 percent over two years.
Fully 56.3 percent of respondents have over-the-top subscription services, an increase of 3.6 percent, year over year, and 8.1 percent over two years.
Of those respondents who are cord-cutters or cord-nevers, 74.5 percent buy a monthly subscription service, compared to 55.1 percent of linear TV subscribers. Netflix and Hulu are the top OTT services used by respondents who do not subscribe to linear TV.
Some 36.1 percent of respondents use pay-per-rental services such as Redbox Kiosks, iTunes, Amazon Prime Instant Video or similar services.
While there was a slight 2.2 percent decrease in usage quarter over quarter, these services did experience increases of 7.1 percent year over year.
Some 41 percent of respondents spend between $3 and $11 a month on pay-per-rental services.
However, across the board overall spend on these services decreased 2.5 percent quarter over quarter and , 5.3 percent year over year.
Perhaps nobody is much surprised by any of those trends, though some might disagree with the magnitude of the reported behavior.
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