State of Digital UK 2023
The increasing adoption of TV-connected digital streaming devices has clearly transformed the way audiences view content on their televisions today.
For many, this transition to watching over-the-top (OTT) content began with a subscription to Netflix. While Netflix can claim much credit for spurring this transition to OTT, there are emerging signs that the medium is now growing well beyond its largest player, as other services are now capturing the attention of viewers and staking out their respective positions in the market.
In December 2016, according to Comscore data, more than 49 million homes – 53 percent of U.S. Wi-Fi connected homes – accessed at least one OTT service. Moreover, these households were active in viewing OTT content, doing so an average of 19 separate days during the month, and for 2.2 hours per usage day. OTT viewing mirrors linear TV with the highest concentration of activity happening during traditional Primetime hours.
While Netflix remains the clear leader in the OTT market, it’s also clear that other services are now establishing their own presence. Netflix reached an impressive 75 percent of OTT homes as of December 2016, but YouTube had a large OTT footprint being viewed in 53 percent of those homes. Amazon Video was third with 33 percent reach, and Hulu was fourth at 17 percent. In fact, there are now 11 OTT services that reach one million or more homes in a given month.
While some may find it difficult to think of Netflix as second in anything, in terms of engagement, it’s number two with 28 hours of average viewing time per home. Sling TV, which makes a “skinny bundle” option that features content from multiple networks, leads on a “per household” basis with 47 viewing hours per month.
Although three out of every four OTT homes do watch Netflix, it’s important to recognize that the remaining 25 percent of these homes watch only competing services. More than 30 percent of YouTube’s and Twitch’s TV audiences, for example, do not watch Netflix on the TV. For Hulu, it’s 14 percent.
Netflix’s dominance is also being challenged by Amazon Video, which appears to be growing the OTT pie through its tie-in to Amazon Prime and the Fire TV platform. At the time of this writing, Netflix is the top OTT service on every viewing platform from Roku to game consoles to Blu-ray Disc players, with one big exception: Fire TV. On the Fire TV stick/box, Amazon is first, followed by YouTube. Netflix is third.
OTT is a growing an increasingly important segment of the video viewing landscape, and the popularity of multiple services beyond Netflix suggests the market is poised for more growth. With 50 percent of households still yet to engage with OTT as of December 2016, there is a major opportunity for a number of services to help fill this vacuum. The question is whether – or to what extent -- Netflix can retain its leadership position in this space as that happens.
To uncover more OTT consumption insights and to find out how Comscore can help you measure this evolving market: contact us.