nScreenMedia OTT multiscreen media analysis

SVOD market deepens, broadens in the US and Europe

SVOD customers paying for multiple services

New service launches, increasing competition, and consumers taking multiple services show that the SVOD market is maturing. The good news is there is still plenty of room for growth.

Boomerang joins growing list of kid services

Turner and Warner Bros are working together on the new direct-to-consumer SVOD service called Boomerang. The service, which launched officially today, offers more than 5,000 titles including classic cartoons from Looney Tunes, Hanna-Barbera, and MGM libraries. For $4.99 a month ($39.99 a year) children can enjoy classics including The Flintstones, The Jetsons, Tom & Jerry, and Scooby Doo.

Boomerang joins an expanding array of SVOD services aimed at kids. PBS Kids, Noggin, ameba, and hooplakidz plus all target the very youngest viewers. Children also have access to their own portals on services like Netflix and Hulu.

SVOD consolidates position in Europe and North America

Ampere Analysis released new data showing that 40% of TV viewers in North America and Europe have both pay TV and SVOD. This is up from 24% two years ago. Further, the data reveals that the number of people relying on pay TV exclusively has decreased from 49% in Q3 2015 to 30% in Q1 2017. Over the same period, the number of people relying on SVOD exclusively increased from 5% of Internet users to 13%.

Netflix maintains dominance, draws competitors

comScore says that Netflix continues to lead the OTT market in the U.S. 75% of OTT homes have Netflix, 53% watched YouTube, 33% Amazon, and 17% Hulu. The company claims there are now 11 OTT services that reach at least 1 million homes in any month. This would include CBS All Access and Showtime, both of which CBS claims has more than 1.5 million subscribers. HBO Now has more than 2 million subscribers.

Such a dominant position makes Netflix an easy target for would-be competitors. Bloomberg reports that Comcast is planning to launch a competitor service sometime in the next 12 to 18 months. It plans to leverage content from NBCU. Bloomberg reports that this could include content from channels like SyFy, USA, and Bravo. If these reports are true, Comcast will have to up its game if it is to compete with Netflix. NBC will spend $4.3B on content in 2017, while Netflix plans to spend a reported $6B this year on new shows.

SVOD market is broadening

Despite the dominance of Netflix, the SVOD market does appear to be broadening out. Ampere Analysis says that Internet users in Europe and North America now typically subscribe to 2 or 3 services. They are also not seeing very much overlap between the libraries in their services. Only 6% of the titles in German and U.S. SVOD services overlap.

451 Research says that 19% of US streaming subscribers pay for three or more SVOD services. That’s up 4% from last year. TiVo research confirms the trend. It says that the number of people spending over $25 a month on SVOD services was 8.2%, up 4.6% over the last two years.

With more consumers taking multiple SVOD services, and 2 in 5 still not using them, there still seems to be plenty of growth left in the market.

Why it matters

SVOD services have entered the mainstream, with most consumers in the US using them.

The market is maturing, with main content categories like kids’ content enjoying multiple competitive services.

Consumers are subscribing to more services, and primary services like Netflix are deepening penetration.


Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.