Are consumers cutting the Cable TV cord

Juniper Research suggests that consumers are cutting ties with Cable TV and switching to online TV streaming services instead.

Scissors cutting the cable TV cord

Consumers are ditching cable TV in favour of online TV services.

A recent study by Juniper Research has unveiled interesting developments in the world of mobile video. Juniper Research estimates that by 2017, 2 billion people will watch TV and video on their mobile and tablet devices. The research suggests that this growth is attributed to the popularity of short and shareable video clips. This highly engaging form of content combined faster mobile internet speeds and better displays are all cited as contributing factors.

The report by Juniper Research titled “Mobile/Tablet TV & Video: Content, Broadcast & OTT Strategies 2013-2017” studies how mobile is being adopted as the first and primary screen for consumers to watch TV and video content. The mobile screen is predominantly and unsurprisingly most popular among younger demographics, most notably due to its alignment for easy sharing to social networks.

The research by Juniper goes on to suggest that the rising popularity of streaming services such as Hulu and Netflix may have major implications for broadcast and cable TV providers which can’t compete with the lower subscription prices being offered by the streaming services.

One of the main dominating factors which has contributed to the success of services like Netflix, is their multi-screen experience offering. Subscribers can watch Netflix on a variety of devices from connected TV’s and tablets to mobile devices and desktop computers. The multi-screen offering allows for a seamless and consistent user experience. Previous research from Google’s “Our Mobile Planet” study showed that every day we use an average of three different screens to accomplish various tasks, which indicates that usage of multiple screens is heavily integrated into our everyday lives.

The services offered by online TV streaming companies have begun to affect cable TV products, with many consumers deciding to “cut the cable TV cord” in favour of online services. Despite this challenge, cable companies are putting on a brave face and developing multiple platforms of their own. Sky (a UK based cable company) has recently introduced Sky Go, a smartphone app which allows users to watch their Sky subscriptions via their mobile device.  Also in the UK, popular individual channels are also competing in the move to online TV. BBC, ITV and Channel 4 are just some of the TV channels that have developed on demand TV services for their content across websites and smartphone apps.

The research by Juniper also focuses on the use of feature phones in developing countries. Faster processors and better display screens on feature phones means that using them to watch online TV and video is no longer a tiresome experience. In many developing regions, the interest and acceptance of wireless devices is much higher than it is for traditional broadband packages. This suggests that feature phones are the main device by which consumers access video content.

In conclusion, it is likely that over the coming year we will see a diverse offering of new online TV and video products as cable companies increase their distribution options and individual TV channels establish their own platforms in order to increase monetization. With the new YouTube paid subscription business model it is likely that we will see high quality TV content uploaded to the site including movies and popular TV shows. The rise in demand for online TV and video has excellent propositions for advertisers as online video has proven to be both a trackable and effective format of advertising which drives brand awareness and increases ROI.

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