Only 5% of U.S. broadband users subscribe to a vMVPD, research company says

AT&T / DirecTV Now
More people have signed up and quit vMVPD services like DirecTV Now than remain customers of these platforms, according to research company The Diffusion Group. (DirecTV Now)

There are more U.S. broadband consumers who have sampled and then canceled subscriptions to virtual MVPD services than current vMVPD customers, according to The Diffusion Group (TDG).

The research company provided data from two surveys of digital video consumers conducted late last year. TDG found that 5% of adult broadband users in the U.S. currently subscribe to a vMVPD service, while 8% have tried one out but canceled their subscriptions. 

“In other words, more subscribers tried and canceled a vMVPD service than currently use one—undoubtedly due in large part to the absence of a contract and ease of cancellation,” said Michael Greeson, president and co-founder of TDG, in an email sent to FierceCable. 

Indeed, reports about excessive churn for services that can be as quickly quit as they are signed up for appear to be real. 

RELATED: FuboTV touts livestream supremacy as rival vMVPDs Hulu and PlayStation Vue go down during Super Bowl

TDG found that among vMPVD users, 23% indicated to varying degrees an intent to cancel their subscription in the coming six months. However, 60% of these would-be virtual cord cutters said, also to varying degrees of likelihood, that they’d sign back up once a new season of their favorite show, or a coveted live sports event, came onto the programming grid. 

“The model encourages such behavior,” Greeson said, “so it is not surprising to see it play out when big events occur.” 

Also notable: TDG said 40% of vMVPD customers also carry a linear pay TV bundle. 

“I believe this is taking place largely because of the fact that no contract or credit check is required, making it easier to test out virtual services even while maintaining a legacy service,” Greeson added. 

Suggested Articles

Alan Wolk, lead analyst and co-founder at TV[R]EV, takes on YouTube's reported service bundling plans and Roku's strong fourth quarter.

Netflix quietly revealed last week that it has begun streaming AV1 encoded content through its app for Android mobile devices. It’s a big deal.

Roku rounded out 2019 nearly 10 million active accounts ahead of where it ended 2018 as the company continues its momentum in the streaming space.