So Far, the HBO Model Leads OTT Subscription Video

It might be less than fully accurate to characterize over the top streaming services as being “like HBO” in emphasizing pre-recorded content or “like Sling or DirecTV Now” in focusing on live network streaming. Still, there are differences. Netflix long has been viewed by many as a functional substitute for HBO, while Sling has been viewed as a way of streaming TV networks.

In that regard, Netflix users average 28 hours of monthly viewing time, while Sling TV customers watch 47 viewing hours per month. To be sure, the lines are not impermeable, as Netflix and Amazon Prime, for example, create a growing amount of original series content.

Still, as Sling customers are seen as substituting OTT for linear TV subscriptions, you see the pattern. There is a difference between live streaming of networks and access to archival or other pre-recorded content.

The analogy is to sports or news content, which provide the highest value as “live” formats (even if the news category is lightly viewed in many age segments). That behavior suggests there are at least two big segments of the OTT business: the HBO style service and a replacement for “live” TV.

YouTube represents the third major segment: user-generated video, with a distinct revenue model mostly based on advertising, not a combination of advertising and user fees (subscriptions), at least for the most part, as YouTube also has moved closer to supplying a subscription TV service.

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