Approximately 8.4 million U.S. households, or 7 percent of homes, have broadband and at least one over-the-top video service, but do not subscribe to pay-TV, according to new research published Thursday by Parks Associates.
Across all Western nations, the share of broadband- and OTT-only homes is about 4 percent, according to the research company.
Seven percent of U.S. households are now broadband and OTT-only. (Source: Parks Associates)
The figure lends credibility to a flurry of OTT announcements by programmers such as HBO and Showtime, and pay-TV operators including Dish Network (NASDAQ: DISH) and Canada's Rogers Communications, which pegged the U.S. broadband-only census at around 8 million to 10 million homes while touting their new services.
"The OTT video services marketplace continues its rapid rate of change, impacting the video ecosystem across world markets," said Brett Sappington, director of research at Parks Associates. "While operator attempts at TV Everywhere have made little impact, OTT video services are experiencing a boom. A variety of new players are entering the market, and operators including Dish Network, Rogers Communication, Bell Canada and Sky are responding with OTT video services of their own. How the industry responds to this change will ultimately affect the fundamental structure of the video industry for years to come."
Parks predicts that subscription revenue from OTT services will climb from nearly $9 million in 2014 to more than $19 million by 2019. Currently, 57 percent of U.S. broadband homes subscribe to an OTT service.
"Avid video consumers are still taking pay-TV services if they can afford them. However, companies in the video ecosystem are eager to reach those consumers who are currently falling through the pay-TV cracks," Sappington said.
- read this Parks Associates release
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