40% of Broadband Users Likely to Leave Pay TV for vMVPD: Parks

Forty-three percent of U.S. broadband households with traditional pay TV are likely to switch to a virtual MVPD in the next 12 months, reported Parks Associates Thursday, reversing a trend of slowing growth. Before the pandemic affected streaming video consumption, vMVPD subscriber growth was “waning, with some vMVPDs posting continued losses,” said analyst Paul Erickson. Though COVID-19 drove growth “and in some cases recovery in the category, recent increases in vMVPD pricing make it uncertain how consumers will respond long term,” he said. The absence of live sports and performances challenged vMVPDs, but services like Hulu + Live TV and YouTube TV successfully pushed advantages in pricing, content and platform flexibility, Parks said. Though traditional pay-TV operators have either deployed over-the-top services, or plan to, Parks expects vMVPDs to continue to grow “dramatically,” and gradually become “the dominant offering in the pay-TV landscape,” said Erickson. Some 17% of vMVPD subscribers switched from traditional pay TV within the past 12 months, said the analyst. VMVPDs should “remain conscious of consumer price sensitivity while keeping a strict adherence to a consumer-centric experience,” Erickson said.