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Omdia believes the U.S. may have reached the ceiling for online video service self-bundling

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The research company Omdia believes we may have found the ceiling for the number of services that an online video service user will take in the U.S., and that number is seven. Speaking at Connected TV World Summit recently, Maria Rua Aguete, Executive Director at Omdia, revealed figures from her company’s consumer tracking and it shows that average online video services per online video services user was 7.06 in April 2021, down from 7.23 in November 2020. “So, for the first time, the number of services [per online video service user] in the U.S. is falling,” she observed.

The average number of SVODs taken is still growing, and the fall is explained by a drop in the average number of AVOD services being used in these U.S. homes. Rua Aguete says: “Consumers have been dipping in and out of online streaming services and switching between them, and it is easier to give up a free service.” Within the AVOD sector itself, it is the broadcaster VOD services that have been most affected, the Omdia survey showed.

Rua Aguete is confident that the latest figures demonstrate a ceiling for the number of streaming services we will see per online video service user, not only in the U.S. but in other markets. “Does it mean that seven is the number where consumers think that it is already too many services to handle? The number is going down in the U.S., where they have hit seven, whereas it [the number of streaming services used] is still growing in other markets where the figure is still well below seven. Seven is the point at which service numbers have started declining,” she declares.

Omdia presented figures for online video services used per online video user across different markets in April 2021 and the numbers are: U.S. 7.06; UK 5.78; France 4.96; Germany 4.12; Japan 2.6; Brazil 4.74; Mexico 4.48.

In April 2021 the number of online video subscriptions per online subscription video household were: U.S. 3.16; UK 2.18; France 1.95; Germany 1.93; Brazil 2.3; Mexico 2.12. Streaming subscription service numbers are still growing in all markets. “There is no fatigue for SVOD – totally the opposite: the number of SVODs taken per home is growing quarter on quarter,” Rua Aguete stated.

Omdia has also crunched the numbers to show what is happening within all U.S. video households (as opposed to focusing on online video users), thus providing an average view for the market as a whole, with non-digital homes also included. The figures below (for the U.S.) show the average number of video services per video household by sector.

  • November 2018, Pay TV 0.7, SVOD 1.7, AVOD/Free 3.8
  • April 2019, Pay TV 0.7, SVOD 1.8, AVOD/Free 3.6
  • November 2019, Pay TV 0.7, SVOD 1.9, AVOD/Free 4.4
  • April 2020, Pay TV 0.7, SVOD 2.2, AVOD/Free 4.5
  • November 2020, Pay TV 0.6, SVOD 2.5, AVOD/Free 4.7
  • April 2021: Pay TV 0.7, SVOD 2.6, AVOD/Free 4.1

These figures also show a drop in the number of AVOD services being used (and they show a relatively stable figure for Pay TV across the whole period amid notable growth for the online streaming services).

Omdia has already forecast that all the growth in video service subscriptions for 2020-25 will come from online streaming video and this will amount to 500 million net additions, taking online video subscriptions to 1.6 billion by the end of the forecast.

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