James R | On 25, May 2015

Do you use someone else’s account to watch Netflix? You’re not alone.

A new study from Parks Associates reveals that 11 per cent of all US households rely exclusively on shared accounts when using subscription VOD services, such as Netflix and Amazon Prime.

Over-the-top streaming services are becoming increasingly popular – last week, research highlighted the growth among older viewers, as VOD goes mainstream. Parks’ study shows that more than half (57 per cent) of households with broadband in America have a subscription account, but that account sharing is a “lingering challenge” for the industry.

As of Q3 2014, 8 per cent of US households use a subscription VOD account held by someone outside of their home, while 6 per cent are exclusively using shared accounts to access subscription content. This equates to 11 per cent of all households that are relying exclusively on shared accounts.

“OTT video accounts for a disproportionate amount of content consumed when compared to expenditure—over one-third of video consumed per week is OTT, but it is only 9 per cent of the household video budget,” comments Brett Sappington, Director of Research, Parks Associates.

“Account sharing is part of the larger problem in monetizing the strong consumer demand for OTT content.”

Netflix is the service most affected by the trend, with 11 per cent of subscribers using accounts paid for by someone else. This is perhaps unsurprising given Netflix’s comparatively larger customer base: 10 per cent of Hulu subscribers use accounts paid for by someone else, while only 5 per cent of Amazon Prime subscribers do the same.

Account sharing is highest among younger households: 22 per cent of those between 18 and 24 using an OTT service have a subscription paid by someone outside of their household.

“In terms of hours of consumption per dollar spent, consumers have every reason to shift spending to online video. While the all-you-can-eat subscription model is very popular, several OTT services are experimenting with models that blend advertising, subscription, and transactional options,” adds Sappington.

“Pay-TV providers will have to quickly move up the OTT learning curve, which is very different from the traditional pay-TV environment.”

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