Two-thirds ‘keep pay TV due to bundles’

Two thirds of US pay TV customers say that they keep their TV subscriptions because it is bundled with their internet service, according to new research.

Deloitte’s 11th Digital Democracy Survey said that 49% of all US consumers – and roughly 60% of generation Z, millennial, and generation X viewers – now subscribe to paid streaming video services.

This figure has grown steadily in recent years, with some 31% of US households subscribing to a service like Netflix or Amazon Prime Video in 2012 and 43% in 2014, according to the research.

While some 74% of consumers across US households still subscribe to pay TV services, such as cable or satellite TV packages, Deloitte identified bundling as a possible reason why this figure is holding “fairly steady”.

“Amid these new realities, companies could find fresh opportunities to reach consumers via free content – leveraging in-video advertising, for example,” said the report.

“They also might see new opportunities to deliver content and solutions to help consumers cut the pay TV cord – or, alternatively, to show them why there’s value in not cutting the cord.”

According to the study, viewers that stream video content get 40% of this video from free streaming services like YouTube, 35% from paid services and 25% from other sources.

Discussing changing viewing habits, Deloitte said that 73% of US consumers – and nearly 90% of millennials and gen Z – reported having binge-watched video content. Close to 40% of millennials and gen Z said they binge-watching content weekly.

Some 45% of millennials use ad-blocking software and 27% of gen Z said that an online recommendation from someone within their social media circles can highly influence a buying decision, while just 18% of this age group said a TV ad would do the same.

Eighty-four percent of all consumers and over 90% of gen Z and millennials are on social networks and more than 50% of gen Z and millennials said they use social networks to learn about new TV shows, citing it to be more useful than TV commercials.

“The shift to streaming, mobile, on-demand services and personalisation are significant opportunities in 2017. Brands can bring newvalue, services and incredibly entertaining content to the empowered consumers across all age groups in a manner that can be monetised,” said Kevin Westcott, vice chairman and US media and entertainment leader, Deloitte.

The Deloitte survey was conducted in November and focused on five generations of people: generation Z, aged 14-19; millennials aged 20-33; generation X aged 34-50; baby boomers aged 51-69; and matures aged 70 and above.

The survey polled 2,131 US consumers and the data was weighted to the most recent US census to give a representative view.

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