Account-Sharing a 'Lingering Challenge' for OTT Market, Parks Says

Account-sharing, a “lingering challenge" for the over-the-top category, will be a panel topic at Parks Associates Connections conference, Tuesday-Thursday, in San Francisco. Some 57 percent of U.S. broadband households access an OTT video subscription, Parks said in a Friday news release, citing Q3 2014 data, but 8 percent are using a subscription OTT video account held by someone outside of their home. Six percent of viewers are exclusively using shared accounts to access subscription OTT video content, the industry researcher said. That equates to 11 percent of all households that are relying exclusively on shared accounts when using subscription OTT services, Parks said. Eleven percent of Netflix subscribers, 10 percent of Hulu Plus subscribers and 5 percent of those using Amazon Prime Instant Video are using an account paid for by someone else, Parks said. It said that account sharing is highest among younger households, where 22 percent of those 18-24 years old who use an OTT service used one paid for by someone outside of their household. "OTT video accounts for a disproportionate amount of content consumed when compared to expenditure,” Research Director Brett Sappington said. More than a third of video consumed per week is OTT, but it's only 9 percent of the household video budget, Sappington said. "Account sharing is part of the larger problem in monetizing the strong consumer demand for OTT content.” While the all-you-can-eat subscription model is “very popular,” several OTT services are experimenting with models that blend advertising, subscription and transactional options, Sappington said. "Pay TV providers will have to quickly move up the OTT learning curve, which is very different from the traditional pay TV environment."