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11
WHAT’S TV WORTH?A P R I L 2 0 1 6
EXCERPT OF FINDINGS
2• Prior to 2015, the age range for this study was 16-64. On slides with trending to 2014 or earlier, the data is for viewers age 16-64 2
• Age 16 to 74*• Watch at least 5 hours of TV per week• Have broadband at home• U.S. census balanced• Data collection completed in March 2016
We surveyed 1,502 TV consumers…
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SCREENS AND CONNECTORS
ONLINE CHANNEL OR MCN
MVPD
SVOD
The New Normal: The average viewer combines multiple TV sources to make their own TV package
Live VODTV Everywhere
DVR
ELECTRONIC SELL THROUGH
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“What’s TV Worth” tracks how consumers choose, use, and allocate their time across these options
USAGE
DEFAULT
VALUE
DEVICES
CHOICE
Which TV platforms consumers are using, independently and together
The screens viewers watch on, and the devices they use to connect their TVs to the internet
Which sources viewers use as their “default” – the first thing they turn on when they want to watch
Which TV platforms, and which specific brands, consumers perceive to be most valuable
Which features and attributes drive viewers to use certain TV sources over others
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Executive SummaryOverview of Key Findings
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SVOD is emerging as the dominant model for consuming TV
67%prefer streaming
68%
37%
14%
use at least one SVOD, up from 47% in 2015
use 2 or more SVODs – twice as many as last year (19%)
use 3 or more, up from 2% last year
More users are adopting SVOD platforms, and many are using more
than one
Rising Usage
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SVOD is emerging as the dominant model for consuming TV
67%prefer streaming
68% use at least one SVOD, up from 47% in 2015
37%subscribe to 2 or more SVODs – twice as many as last year (19%)
14% subscribe to 3 or more, up from 2% last year
More users are adopting SVOD platforms, and many are using more
than one
43%
49%
61%
46%
60%
67%
PayTV
AmazonPrime
Netflixstreaming
2016
2015Pay TV
Rising Usage High Perceived Value
% RATE “GOOD” OR “EXCELLENT” VALUE
Perceptions of major SVOD platforms continue to rise, while pay TV is flat
Ç
Ç
Ç Significantly higher than 2015
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72%
70%
42%
36%
TV Set
Computer
Tablet
Smartphone
For the first time, more online viewing happens on TV sets than any other device
WHICH DEVICES HAVE YOU USED TO WATCH ONLINE TV SHOWS?
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Traditional linear viewing continues to drift farther from the hub of the TV universe
43%
35%
27%
All viewers
Netflix subs
Age 18-24
2016: % WHO DEFAULT TO LIVE TV
Live TV’s position as the default source for TV continues to fall
Among viewers Age 16-64
55%
43%
32%
2014
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State of the CordTrends in MVPD usage
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WHICH OF THE FOLLOWING BEST DESCRIBES YOU?
As in past years, those with no pay TV are split roughly evenly between cord cutters and cord nevers
6%
5%
Subscriber: Currently have a cable, satellite, or telco TV subscription
Q2A. Do you currently have any of the following television services in your home? Q2B. Have you ever had a cable, satellite, or fiber optic TV subscription in your name?
Among 16-74 year olds
89%Cord Cutter: Don’t have pay TV now, but did in the past
Cord Never: Don’t have pay TV now, and never have
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7% 7% 7%
24% 22% 22%
39% 41% 42%
30% 30% 29%
2016 2015 2014
Q2J1: One year from now, how likely are you to still have at least some service from [PROVIDER FROM Q2A]?
…and fewer than 10 percent say they definitely plan to cut their pay TV service
HOW LIKELY ARE YOU TO HAVE A PAY TV SUBSCRIPTION A YEAR FROM NOW?
69%
Among 16-64 year olds with a Pay TV subscription
Definitely or
Probably will
Definitely Will still have my subscription
Probably Will
Might or might not
Definitely/ProbablyWon’t
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Use of Online SourcesThe evolution, televised
14Q3A: Have you ever watched TV programs or movies from an online source, on any device?
80 percent of viewers watch from at least one online source – the highest since we began tracking
74% 78% 80%
2014 2015 2016
WATCH TV OR MOVIES FROM AT LEAST ONE ONLINE SOURCE:
Among 16-64 year olds
2016
15
68%
37%
30%
20%
16%
13%
Q3A: Have you ever watched TV programs or movies from an online source, on any device?
WHICH OF THE FOLLOWING HAVE YOU USED TO WATCH TV SHOWS OR MOVIES ON IN THE PAST SIX MONTHS?
Online streaming subscriptione.g. Netflix, Amazon Prime, Hulu
TV network site or app
Free aggregator e.g. Crackle, free content from Hulu
MVPD site or app
Online shows and movies bought/paid for individually
“Unofficial” sitese.g. Putlocker, uTorrent, Pirate Bay
Among 16-74 year olds
The most common online source: SVOD subscriptions
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Online streaming subscriptione.g. Netflix, Amazon Prime, Hulu Plus
TV network site or app
Free aggregator e.g. Crackle, free version of Hulu
MVPD site or app
Online shows and movies bought/paid for individually
“Unofficial” sitese.g. Putlocker, uTorrent, Pirate Bay
68%
37%
30%
20%
16%
13%
47%
41%
33%
24%
19%
14%2016
2015
Q3A: Have you ever watched TV programs or movies from an online source, on any device?
WHICH OF THE FOLLOWING HAVE YOU USED TO WATCH TV SHOWS OR MOVIES ON IN THE PAST SIX MONTHS?
Ç
Ç
Among 16-74 year olds
SVOD usage has shot up since 2015
Ç
Ç Significantly higher than 2015
17
18%
28%
62%
11%18%
50%
9%15%
43%
g 2014 g 2015 g 2016
Q3B. Do you currently have a Netflix subscription specifically, for either its online streaming service or its DVD by mail service? Q3D: Which of the following other online streaming subscription services does your household subscribe to?
Significantly higher
DO YOU CURRENTLY USE…?
Among 16-64 year olds
Use of Netflix, Amazon, and paid Hulu subscriptions continue to grow
*
*Hulu 2014-15 data shows penetration of Hulu Plus; 2016 data is based on Hulu Limited/No Commercials subscription
Ç
Ç
Ç
Ç
Ç Significantly higher than 2015
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Default TV SourcesThe TV bundles consumers create on their own
19Q4F. Think about the different sources you use for TV programs. Which would you say is your “default” source--the one you are most likely to turn to first when you want to watch something?
WHAT’S YOUR DEFAULT SOURCE FOR TV?
Among 16-64 year olds
43%
17%
19%
45%
19%
16%
55%
18%
11%
Live TV from
MVPD
2016
2015
2014
Shows on your DVR
2016
2015
2014
2016
2015
2014
In 2016, more viewers default to watching on Netflix than to watching shows on a DVR
20Q4F. Think about the different sources you use for TV programs. Which would you say is your “default” source--the one you are most likely to turn to first when you want to watch something?
“DEFAULT” SOURCE FOR TV SHOWS: AMONG MILLENNIALS
32%
12%
31%
34%
14%
23%
43%
17%
19%
Live TV from
MVPD
2016
2015
2014
Shows on your DVR
2016
2015
2014
2016
2015
2014
Among Millennials, Netflix as the default source has jumped since 2015 (now tied with live TV)
Ç Significantly higher than 2015
Ç
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TakeawaysThings to remember
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Takeaways
As a category, SVOD continues to add users (including default users)
Led by strong growth for Netflix, Amazon, and Hulu—along with inroads from standalone services—SVOD subscriptions have jumped more than 20 points in the past year.
Consumers have internalized that online TV is worth paying for
Netflix is seen as a better value than free-with-ads platforms. And the percentage using the free version of Hulu is just half what it was two years ago.
1
2
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Takeaways
Use of multiple SVODs is becoming commonplace
The number of people who say they use two or more SVODs has doubled in a year. And the number of people who only use one has declined.
The vast majority of viewers still have pay TV
Cord cutters are rare, the numbers are not climbing, and single-digits say they’ll drop pay TV in the coming year.
3
4
24
Takeaways
But retaining share of mind is a different story
• Those who change their MVPD service are more likely to cut back channels than to add them
• The number of consumers who “default” to live TV is at its lowest since we started tracking.
• It’s lower still among younger viewers
• Netflix is gaining momentum as a default source of TV
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