OTT gains traction in Europe
James R | On 30, Mar 2016
OTT video services are gaining traction in Europe.
Over-the-top platforms, which provide video directly to consumers over the Internet, are increasingly popular in the USA, as audiences cut the proverbial cord to replace costly cable subscriptions with cheaper, more flexible online alternatives. OTT video services are now springing up on the continent, led by Netflix, Sky and Amazon in the UK.
55 per cent of UK broadband households and 51 per cent in France watching TV programming and movies online, compared to 70 per cent in the US, according to research from Parks Associates. However, the number of paid subscriptions in Europe is significantly lower, where 30 per cent of broadband households in the UK and 17 per cent in France subscribe to OTT video, compared to 64 per cent of US broadband households.
“In many parts of Europe, pay-TV penetration is lower than the U.S., and European consumers have been reluctant to pay for video in the past due to so many ‘free’ options such as the BBC iPlayer, comments Brett Sappington, Director of Research. “But, as more pay options enter the market, with content unavailable anywhere else, they are slowly changing the culture of video viewing in Europe.”
Indeed, new services are emerging in France, including a transactional video platform from well-known retailer FNAC, while Netflix has struggled in the French market, despite partnerships with many of France’s leading pay-TV providers.
“In the US and Canada, the quickly increasing volume of new options is driving high numbers of online viewing of TV and movies,” Sappington adds. “Each service is bringing new experiences for consumers, and many are providing new content that is unavailable elsewhere.”
AT&T, Sony, and HTC have been the most recent to announce new OTT video services in the US market, and Spotify recently added video to its freemium OTT music service. PlayStation Vue also recently became available nationwide across the US.
“Consumers are trying and subscribing to more services,” Sappington continues. “We saw a big increase in the number of households subscribing to multiple OTT video services in the US market at the end of 2015.”