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New Report Shows Other SVOD Services Creeping Up on Netflix

Half of all U.S. broadband households subscribe to Netflix, but there’s growing evidence that other streaming services are making significant inroads as viewers are increasingly subscribing to multiple services.

Two-thirds of U.S. broadband households subscribe to at least one SVOD service, according to a new report by the research firm Parks Associates, and one-third subscribe to two or more services. The most popular combination, Parks found, is Netflix and Amazon’s Prime Video.

“There are service stackers willing to experiment with different OTT combinations as new services arise,” Brett Sappington, the first’s research chief, wrote in the report. “The regular release of high-quality original content, such as The Grand Tour (Amazon) and Gilmore Girls: A Year in the Life (Netflix), ensures the large OTT players will remain a core, consistent subscription among service-stacking households.”

The report also found that U.S. consumers pay an average of $29 per month for what Parks calls “incremental video-related entertainment beyond pay TV,” and the the biggest chunks of that are movie tickets ($9.32 a month) and SVOD services ($7.95 a month), which will almost certainly rise in 2017 with Netflix’s $2-a-month price increase and the growth of newer streaming services.

“The average spending on subscription OTT video has increased over the past four years, with a notable jump in 2016,” Parks researcher Glenn Hower wrote. “The average monthly spend of $7.95 on subscription OTT video services is remarkably close to the $7.99 pricing of the lowest tiers of service for Netflix and Hulu, indicating that consumer expectations for U.S. market pricing has been set by Hulu and Netflix.”

Surprisingly, only $0.80 a month goes to video downloads like movies on-demand.

The report forecasts that 2017 will be a big year for bundled TV services like Sling TV, Playstation Vue and DirecTV Now and similar services expected from Hulu and YouTube and subscribers continuing to experiment with different combinations of services.

Scott Porch writes about the streaming-media industry for Decider and is also a contributing writer for Playboy. You can follow him on Twitter @ScottPorch.

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