Time and time again, consumers have expressed their frustrations with streaming video providers about the overwhelming volume of content and the sheer number of services that seemingly pop up every year. According to Interpret’s study, “The Future of OTT Aggregation,” more than 20% of U.S. consumers agree that they “subscribe to too many video streaming services.”
Interpret’s study is based on extensive industry research, interviews with market leaders and innovators, as well as online survey data of 9,000 US consumers.
Interpret found that U.S. customers subscribe to an average of four or five subscription video on demand (SVOD) services and that the majority also access multiple free, ad-supported TV (FAST) services. That can be an obnoxious amount of content to navigate and manage. Furthermore, there are nearly 340 million subscription contracts to over-the-top (OTT) streaming services in the U.S., exceeding the country’s population of approximately 330 million people. OTT services are media platforms that are offered via the internet and bypass traditional, linear broadcast models.
In a January 2022 report by Accenture, three-in-five subscribers to multiple streaming services are annoyed with their viewing experiences, and 44% of survey respondents (out of 6,000) said that they spend more than six minutes searching for content to watch. In addition, over 60% of the content that they are paying for is not relevant to them and 56% say they wish that their profile from one service could be shared with another in order to get better, more personalized content.
Consolidating content under a single streaming brand, such as WWE content becoming part of Peacock or HBO consolidating WarnerMedia content under HBO Max, increases subscriber count and offers more content at a single, affordable price.
Brett Sappington, Vice President at Interpret said, “Several cracks in the armor of the OTT video service experience become evident as consumers add more and more services to their viewing portfolio. Finding content is more difficult, often requiring subscribers to explore each service. Each service account must be managed separately, and each has its own payment system and credentials.”
Interpret analysts believe that current and future aggregators should pay attention to the number of streaming gaming consoles, set-top boxes, and smart TV interfaces that consumers have in their homes (the answer is too many); the potential to add financial value for consumers from bundled offerings and ways to eliminate “pain points” when it comes to the subscription process; and ways to differentiate portfolio and payment management tools. Subscribers have also expressed the need for an improvement in account management, discovery, and content recommendation functionality.
Bundling, such as the Disney+/ESPN+/Hulu bundle, provides a single transaction at a lower overall cost and encourages consumers to maintain subscriptions to all three services. Account management initiatives address the consumer need to manage a large portfolio of services, a significantly frustrating aspect of multi-subscription households. Streaming marketplaces such as Amazon Prime Video Channels or Apple Channels allow for centralized purchases and some ability to manage accounts in a single interface.
There are some content providers that are delaying progress in aggregation because they are too busy fighting to retain control over their own parts of the content journey. However, services that are aggregators will very likely experience the most success and go far with their customers. Streamers that choose to focus blindly on subscriber acquisition will risk demise in a shifting landscape.
“Addressing fragmentation will be tricky since there are so many service options, each with its own priorities relative to revenues, data, and audience,” Sappington said. “Yet, the companies that solve the aggregation puzzle have much to gain. Successful aggregation of content and services will produce an improved, sticky customer experience and will drive subscription and ad revenue opportunities. It will also be important to mid-sized or smaller streaming services that cannot afford to out-market global or regional streaming giants.”
Ultimately, aggregation will continue to grow where consumers get the best experience and find the most content.