COVID-19 Accelerated Cord-Cutting, Experimentation, Says Analyst

COVID-19 hastened the trend away from pay TV, Needham analyst Laura Martin wrote Friday. Subscription-driven (SVOD) streaming services grew 20-50% faster than earlier estimates, said Martin, citing as drivers shelter-in-place, lack of live sports, shuttered cinemas and divisive news cycles. She cited a July Roku study saying 40% of cord-cutters say free or extended trials for streaming services encouraged them to cancel a traditional TV package. Because many streaming services drop entire new seasons on one day, they had more hours of nearly completed episodes ready. Needham estimates consumers signed up for two to four new SVOD streaming services, while free ad-driven (AVOD) users doubled. This era is driving more experimentation, including Universal’s multi-year 17-day theatrical window deal with AMC and Disney’s decision to release Mulan for $30 Sept. 4 (see report, Aug. 6 issue). The economic impact of widespread unemployment might negatively affect SVOD streaming services due to less disposable income; or, it could lead users to rotate sequentially among SVOD services rather than pay for multiple SVOD subscriptions simultaneously, Martin said.