DirecTV and Hulu take note: Sweet spot for OTT services is under $30, analyst’s survey says

multiscreen content

With a number of pay-TV operators and technology companies poised to launch over-the-top live-streaming services, MoffettNathanson has released a compelling survey, proving the analyst firm’s belief that these services are wise to keep their price points below $30 a month.

Partnering with Savata, and interviewing 513 consumers online, MoffettNathanson found that 61 percent of respondents would expect to pay under $30 a month for an OTT package that doesn’t include regional sports networks. In fact, 23 percent expect that package to be priced at between $10 to $20. 

For a live-streaming service with regional sports networks, meanwhile, only 43 percent of respondents would expect to pay $40 or more.

This data is somewhat in conflict with pricing rumors for Hulu — early speculation has the company’s live streaming service priced at around $40 a month. 

“Our survey highlights a number of the many challenges facing a serve like Hulu,” analyst Craig Moffett said. “Whether such a service is economically feasible at $40 is debatable. Beyond $50, the demand falls sharply. The majority would expect a service like Hulu’s proposed pay-TV replacement service to cost $30 or less (and some unrealistically expect it to cost less than $10).”

Also alarming: Only 18 percent of respondents who don’t currently have pay-TV are interested in acquiring an OTT service, the survey found. The number was similar for respondents who have pay-TV — 16 percent. 

For more:
- read this MoffetNathanson report (sub. req.)

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