As I face that dreaded time of year in which I have to call my cable provider to try and haggle for a lower monthly bill, I realized what an arduous task this has become. Especially given my OTT options for content. It’s no wonder that pay-TV markets are losing subscribers consistently each quarter.
In fact, EU cable companies have suffered six straight years of cord-cutting (defined as a net decline in cable customer homes). IHS senior analyst Guy Bisson places the blame directly on OTT suppliers.
Consumers love their Netflix, Amazon Instant Video, Hulu, and YouTube services. They offer lower prices, accessibility and in some cases commercial-free programming. Because of this demand, new offerings are coming to market soon, such as:
- Sony to offer live and on-demand content from Viacom (22 networks)
- Rumored online HBO Go subscription (to go head-to-head with Netflix)
- Google Android TV software to power smart TVs and set-top boxes
This means operators must fight harder than ever to keep and win back subscribers. Western Europe’s average pay-TV penetration rate is only 57% (compared to 85 percent in the U.S.). Operators must continue to find and offer move value to viewers. They must dig deep to uncover a long-term solution, not just a one-year price promotion.