These are confusing times for content providers. Despite much of the attention and mass-hysteria around “cord-cutters” and their departure from cable, a new survey shows that viewers are consuming a mix of content both on TV and online.
According to survey data from Furious Corp, 33 per cent of millennials are “very happy” with their cable service and have no plans to cancel. Meanwhile, in the first quarter of this year, “Tier 1 pay-TV providers like Charter added a total of 89,000 subs,” per reporting from FierceCable.
Now combine those stats with an eMarketer estimation showing that one-in-five U.S. households will not subscribe to cable or satellite TV by 2018, and if you’re a traditional cable or over-the-top (OTT) provider, your head will probably spin.
What do content providers make of all this information and how do they address the market moving forward? First, let’s start with consumer demands. Thanks to the Internet and smart devices, consumer demands have fundamentally shifted. They are no longer satisfied with flipping through the hundreds of channels included within their cable package, and expect faster delivery of content as well as the ability to pick and choose their programming.
Despite the latest reports, conventional wisdom has coalesced around the fact that it’s a trend that’s only expected to increase in the years ahead; and for cable and satellite TV providers who lost 383,000 subscribers in 2015, it may seem like a death sentence. However, they shouldn’t call it quits just yet. They should take this opportunity to determine what consumers want and expect with a media and entertainment provider and then develop a strategy to adjust accordingly.
To do so, they’ll first need to consider why OTT streaming services are attractive to consumers.
Consumers are tired of paying a large monthly sum for hundreds of channels they never watch. It’s unrealistic to think every consumer has enough time – let alone interest – in watching that many shows. Consumers also want the ability to watch content when they want to see it, not when the provider chooses to show it. If you’ve ever missed an episode of your favourite show because you couldn’t make it in front of the TV when it was scheduled to air, you know how frustrating that can be.
However, while traditional cable packages continue to annoy consumers with their inflexibility, a number of companies have recognised the benefits of OTT and side-stepped cable companies to offer consumers a more personalised experience with on-demand content.
In order for cable providers to meet consumers’ new demands and expectations, they need the back-office infrastructure in place that will enable customers to personalise their relationship based on what and how much they watch.
Otherwise, they risk becoming obsolete in the new era of OTT content.
James Messer, founder and CEO of goTransverse
Image source: Shutterstock/Paul Matthew Photography