How Can Broadcasters Accelerate SVOD Adoption

Dimitar Serafimov | Mon Aug 07 2017 CET | OTT Industry

SVOD adoption rate

SVOD isn’t quite converting pay TV leavers as fast as expected, but by offering the right level of value and sticking to the proven acquisition strategies, SVOD providers stand to accelerate adoption. 

It’s clear that SVOD services are thriving in today’s digital environment and recent reports show that pay TV is dwindling. But, what’s interesting is that while pay TV subscriptions are falling and SVOD adoption is on the up, the rate at which these trends are moving isn’t quite balanced.

SVOD still doesn’t pick the full cord-cutter slack

The problem is while pay TV companies are set to lose as many as 1.2 million subscribers in the second part of this year, SVOD isn’t picking up the slack as fast as it should.

According to a recent report from Bloomberg, online streaming services including FuboTV, Hulu TV, PlayStation Vue, Sling TV, and YouTube TV have signed up almost three million subscribers, but that’s not enough to make up for the cord-cutters who have left cable and satellite.

It seems that while consumers are ditching their pricey satellite subscriptions, new subscribers aren’t replacing the cord cutters quick enough, and those new subscribers are spending less money overall on the services.

Proven acquisition strategies seem to be working here

For the majority of analysts, the picture looks brighter after the third quarter, this year.

Despite these issues, there’s still plenty of potential for SVOD providers. By rolling out fresh key user acquisition strategies, some companies are reaping the rewards of accelerated user adoption. By offering additional services alongside their video-based offerings or giving people free trials as well as promotional offers, companies like Netflix and Amazon have seen a healthy growth in subscribership in recent times.

In fact, according to the latest Ofcom report,  over 30% of UK respondents said they were incentivized to sign up because of a free trial or promotion.

free trials are main reason for SVOD adoption

Source: Ofcom’s “The Communications Market Report 2017: UK”

Another report (Parks Associates) discovered that nearly half (47%) of US households that signed up for free trials subsequently signed up for paid subscriptions. An excess of six in 10 broadband households (64%) subscribed to at least one of the 101 OTT video services that were available in America as of March last year.

Speaking on the subject, Parks’ senior analyst Glenn Hower said:

“Free OTT trials are effective in converting a sizable portion of trial users into subscribers.”

And we tend to agree. 

While SVOD isn’t quite converting pay TV leavers as fast as expected, it’s plain to see that by offering the right level of value and implementing proven acquisition strategies, SVOD providers stand to accelerate adoption and enjoy healthy doses of long term success.


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