Commentary

We'd Pay For Network TV And Take Netflix With Ads

In the best of all possible worlds, you’d pay for “free” TV and you might want pay subscription services to be free, too.

That’s way simplistic, but it is the gist of Digitalsmiths’ Q3 Video Trends Report that concludes consumers would like 18 channels they pick themselves and might like a streaming service that’s free, and shows commercials.

The company that conducted the survey for the TiVo subsidiary  tapped into 3,140 consumers. There’s some fun stuff in here, like:

--82.4% of the respondents still have a pay TV provider, but of those who don’t, 17.9% quit in the last year. Overwhelmingly, 82.9% quit because it costs too much. Another 59.5% said they use streaming services instead, and 28.1%  watch over-the-air. The report says 44.9% either plan to quit, change or at least think about quitting their pay TV service in the next year. (But talk is cheap.)

--If Netflix or Hulu offered a free service supported by ads, 69.4% said they'd be interested and 83.3% of them say they'd accept one to four commercials in a a half hour period. Of those who say they don't want ads, 14.3% change their minds if the commercials are "personalized" to their interests. (Hulu already offers a pay plus commercials version, it should be noted.)

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--ABC has fans. Of those who say they would like to pay a la carte for TV, 70.7% would pay for ABC, and they’d agree to pay an average of $1.52 a month. Slightly fewer would pay for CBS (70.1%) but they’d agree to pay slightly more--$1.55 a month.  NBC (65.5%, $1.54) comes next, followed by Discovery and History which are all in the same ball park. (After all these years of bashing broadcast networks how interesting where people would still put their money. Fox, by the way, finishes sixth and PBS eighth.)

--43.5% of respondents wish there was a way to integrate all of their OTT services in one place and Digitalsmiths and TiVo recommend cable operators do that for them with their new set-top boxes, something that’s already happening.

Interestingly, this study did a little current-day comparison shopping and determined that none of the existing skinny bundles offer the top 20 channels these consumers say they want. But if customers tried, the combination of Sling TV’s All Channels package ($40) plus HBO would come close and cost $54.95. This report says you’d have to get an over the air antenna to pick up ABC, NBC and CBS.

(But that doesn’t appear to be entirely true. I checked and the All Channels package would give you all Fox and NBC,  if you live in an area where the networks own the local station or the local affiliate has made the deal with Sling. Another package would give you ABC, but not Fox and NBC. CBS takes a subscription to CBS All Access. Likewise, PBS just isn’t on SlingTV.)

Trying to figure this out must be why a lot of people don’t get skinny.

This report says PlayStation Vue has the same problem of gathering network stations together.
The report sizes up the situation like this: “The video industry knows that consumers are willing to pay roughly $80 per month for TV service.

Skinny bundles give consumers a larger percentage of content they desire for a lower price, but add up the cost of a skinny bundle, subscription video on-demand (SVOD) service and a streaming device like Google Chromecast—and the total is essentially back to the cost of a traditional pay-TV package.


“Thus, the question remains: Will consumers catch on that skinny bundles aren’t really skinny? Though a true à la carte offering is unavailable today, consumers still have multiple ways to consume content, and at the end of the day, these options benefit consumers. Will asking consumers to pay the same price for less video content be the future of television? TiVo believes a huge opportunity remains for an enticing offering that delivers great value to consumers, and is economical for providers as well.”

One chuckle-worthy stat is the one that calls into question the real value of DVRs (and by extension, TiVo): Nearly 70% say they use a DVR to keep up; only 42.5% think they have enough time to watch the shows, and 28.3% say they run out of time, apparently regardless of having a device to record programs for later viewing.

That’s not so odd. In every metro area there are storage facilities to fit all the stuff we have but don’t use. Video content seems to live in the same place.

pj@mediapost.com
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