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Multichannel services cede ground to OTT Virtual Service Providers in US video homes: Study

MUMBAI: The increasing loss of traditional multichannel subscribers in the US is further splintering a video landscape in which streamed bundles, online subscription services, self-aggregation and over-the-air delivery are playing more prominent roles, according to findings from Kagan, a group within S&P Global Market Intelligence.

“Changing viewing habits point to mounting losses for traditional video services, and challengers are lining up to capitalise. However, the operators are not without significant fortifications enabling expectations for preserving a majority share in the five-year outlook,” said S&P Global Market Intelligence research director Ian Olgeirson.

Multichannel cedes ground to OTT, VSPs in US video segmentation – S&P Global Market Intelligence

The transformation has amplified the conditions for change and instability in the market, according to the latest segmentation of video delivery options among US households. While households with a traditional multichannel subscription are positioned to remain in the solid majority in the five-year outlook, upward momentum lies firmly with alternative services; the combined account for a non-multichannel tally is on pace to exceed one quarter of occupied households in 2017 and peak one third by 2021.

The outlook through 2021 features:

  • Accelerated declines of traditional multichannel subscriptions to 82.3 million, down 10.8 million households over five years.
  • The emergence of virtual services from a niche pioneered by SlingTV and Playstation Vue to a mainstream option that accounts for nearly 11 million households.
  • The growth of households relying solely on over-the-top delivery of self-aggregated online content to reach nearly 18 million or 14% of occupied households.