retail news in context, analysis with attitude

Nielsen is out with a study about subscription-based video on-demand (SVOD) services, saying that 41% of U.S. homes had access to an SVOD service in fourth-quarter 2014.

"The report found that penetration of both high-speed Internet and SVOD access are strongly income-related," Nielsen says. "In fact, about 13% of homes boast multiple streaming services in their homes and nearly half of homes with SVOD access have a yearly household income of more than $75,000, while two-thirds of homes without broadband access have annual household incomes of less than $40,000 ... The report found that homes with subscription streaming services have a both a penchant for TV-connected technology and, perhaps more importantly, display the greatest usage of these devices—nearly 50 minutes more a day than a typical TV home. Additionally, these homes average 10 more minutes daily watching time-shifted TV and double that in terms of time spent using a multimedia device (such as Apple TV and Roku) than a typical TV home."

Nielsen also is reporting that "13 percent of all U.S. television households use Prime Instant Video, Amazon.com’s subscription video-on-demand business, compared with 36 percent for Netflix and 6.5 percent for Hulu Plus."
KC's View:
While affluent consumers are adopting this pattern of content viewing faster, there's no doubt in my mind that as prices go down, the trend will accelerate ... and traditional content provider businesses will be endangered.

But it also is instructive that these early adopters are not spurning the old ways of consuming content ... they just want lots of options so they can choose the method of consumption and the programming that they find to be most relevant at that moment. This is a good lesson for any consumer-facing business ... since the power more and more resides with the consumer anyway, the best course of action is to embrace the opportunity and play in as many of these fields as possible. The alternative - which is to resist change and try to force the consumers to see and do things your way - is not really an option at all.