New study examines consumer adoption of OTT service bundles via a home service provider

Ahead of NAB next week, Parks Associates announced a new study, Home Service Bundles: OTT as a Value-Added Service, which reveals 59% of OTT subscribers reported that they prefer one bill and one account for all of their home subscription services, while 48% feel their home internet service provider adds more value when online video services subscriptions are offered. The consumer study examines uptake of home service bundles with OTT video services, which providers are offering these bundles, and how these bundles are driving benefits for consumers.

“Simplicity has a fundamental appeal to consumers that service providers can leverage,” said Paul Erickson, Research Director, Parks Associates. “Consumers are seeing value and simplicity in receiving a bundle of channels and services from a single source, and they are increasingly seeking out options that offer OTT services bundled with their home services.”

The study finds that 40% of OTT subscribers report that 100% of their OTT services are bundled through a home service provider. In contrast, just 31% of OTT subscribers report none of their services are bundled through a home service provider. While some of these consumers prefer to keep their video and home services separate, many are simply not aware of the availability of online video service bundled offerings. Word of mouth and recommendations through family and friends are the main avenues for households to discover these bundling options, so home service providers can increase adoption, especially among consumers ages 18-44, by encouraging current subscribers to discuss these offerings within their social circle.

“There is considerable demand for OTT bundles from service providers for the added simplicity, value, and convenience that consumers feel they receive. Verizon’s newly announced Verizon Plus Play, in partnership with Netflix and other services, is an example of service providers serving these consumer demands for simplicity and convenience, via unified subscription management and billing for multiple OTT services,” Erickson said. “The addition of OTT services to service providers’ subscription and bundled service offerings is a viable way to add value, increase long-term ARPU, reduce subscriber churn, and increase stickiness with consumers.”

Parks Associates is attending NAB next week and will host the Future of Video session “OTT Churn: Marketing and Retention Strategies”on May 5. The Future of Video session will examine consumer consumption and subscriptions for video services as well as strategies to keep viewers engaged, featuring executives from Bitmovin, Crackle Plus, Firstlight Media, Gracenote, Metrological, NBCUniversal, Peloton Interactive, ThinkAnalytics, and TiVo.

For more information on Home Service Bundles: OTT as a Value-Added Service,contact sales@parksassociates.com. To schedule an interview with an analyst or request specific research data, please contact Rosey Sera at rosey@parksassociates.com, 972.996.0233.

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