Varied Programming Key to OTT Subscriber Growth, Says Parks

Over-the-top video services aiming to challenge market leaders Netflix, Amazon and Hulu need to feature a variety of programming, said Parks Associates Thursday. Ad-based OTT services have broadened their market appeal over the past few years by incorporating genre categories, with Crackle adding to its nonfiction content, Pluto TV bringing on sports channels and Tubi TV adding kids’ content. “We will see more bundling services emerge like AMC, which bundled together its niche services Shudder, Sundance Now, and IFC Films under the AMC+ service umbrella in order to give viewers more options,” said analyst Paul Erickson. Many niche services have been successful with genres including horror, religious, children’s, and anime content -- and services such as ESPN+, BritBox, and Crunchyroll are an important part of the ecosystem -- but they're unlikely to be the primary content source in a household, Erickson said. Some 44% of viewers who favor a particular genre spend three-quarters of their OTT viewing time on broad-based services, and about half of those spend less than a quarter of viewing time on niche services, said Parks data. Content looms large for consumers, but price is still the leading factor for choosing an OTT service, Erickson said. “A hybrid pricing approach meets consumers where they are,” he said, and maximizing revenue potential with hybrid pricing “will help services finance the growing cost of content library growth.”