Most would agree the subscription video business now is unstable, with major changes looming. On the other other hand, consumers tend to operate within constricted budgets, so the amount of household spending change tends to change slowly.
Parks Associates finds household spending on streaming video services has held steady for three years, averaging just under $8 per month since 2016. Some of you will find that surprising, given the growth in volume of subscriptions.
But Parks Associates has an answer: “adoption of multiple services or expensive services by some consumers is offset by a larger base of consumers who either subscribe to one or two relatively inexpensive services, including 30 percent of consumers who do not spend any money on OTT video services.”
“The stability in average household spend belies the activity going on under the surface," said Brett Sappington, Parks Associates senior director. "2019 may be poised to break that trend.”
“One of three things will happen—more households will become OTT streaming households, rival services will begin to pull subscribers away from Netflix, or that spending number will go up," he said.
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