• by George Simpson , Featured Contributor, October 4, 2018

A report from Juniper Research says some major on-demand subscription video services are losing more subscribers than they are gaining. In the U.K. and the U.S., “abandonment rates outpace adoption” for some services — which, according to Juniper, can be attributed to consumers having too many SVOD subscriptions.

This sounds remarkably like the argument against pay-TV packages that force consumers to pony up for channels they rarely or never watch. Lots of systems in the U.S. offer hundreds of channels, but most homes tend to watch less than 20. In fact, the audience for cable networks by number of total day viewers drops below a million once you fall out of the top 10.

I will let others argue about the way TV sells itself by forcing buys of little-watched cable shows in order to secure placement in better-rated linear network shows, or selling by demos in order to project against cherry-picking audiences now scattered all over hell's half acre. Let's focus for a moment on the weak link in the continuum: the viewer.

The explosion of SVOD offerings is always positioned as "giving consumers what they want: more choice."  But there is a downside to more choice, particularly if each "choice" is costing yet another subscription fee.

Think of it this way: over the years, I have worked with lots of entrepreneurs who thought that the more choices that gave prospects, the more options buyers would have to work with them. In fact, it only diluted the primary offering of the company. I recall one client who launched over a hundred audience segments only to find out in a few months that 98% of revenue was coming from just eight segments. 

People tend to think if they offer a smorgasbord, eaters will enjoy the variety. In fact, eaters look at too many options wondering, "Hmmm, what's best to eat?" They are more inclined to come back to a restaurant they know serves a particular dish that they love and can get prepared the same way each time. 

In the same way, if you want shows about animals, you know where to look on your channel lineup, so you mark that channel as a favorite and tend to go back to it over and over rather than sample the shows on channels about military history or cars.

So now pay-TV households not only have to sort out how to find the quality programming they want out of 300 or so options coming through the cable box, they then have to slug through various SVOD subscriptions (some of which claim to do the sorting for you based on your viewing history — but in fact do a terrible job of it.).

I know many SVOD options are tied to the notion that people no longer want to watch programming on their 50-inch LED flat screens (especially younger folks) or pay the increasingly higher prices of pay-TV bundles, but I think the churn rate of these over 200 SVOD US, subscriptions speak volumes about too much choice, too many overlapping offers, and their cumulative costs.

If content producers really want to offer choice, then let consumers assemble bundles that they pick. Who knows, the final result might be one giant internet-delivered, pay-per-view platform, with tiered pricing for those who will accept advertising in exchange for lower costs per show.