For the first time, Netflix (NASDAQ: NFLX) led the pack in a Morgan Stanley-conducted viewer survey on original content. The SVOD provider was picked by 29 percent of respondents as having the best original programming, beating out HBO, which scored just 18 percent.
Last year, HBO was rated as having the best programming by 31 percent of survey respondents. Morgan Stanley polled 2,501 U.S. adults aged 18 and above.
The results of the sixth annual survey are interesting because it reflects not just Netflix's increased slate of original content but viewer perceptions of the quality of original programming coming from premium providers and OTT providers ranging from HBO to Showtime to Starz and from Amazon (NASDAQ: AMZN) to Hulu and more.
Variety reported that also-ran providers were well behind both HBO and Netflix. Only about four to five percent of viewers surveyed chose Hulu, Showtime or Amazon as having the best originals, and Starz garnered just 2 percent.
The sudden shift to the top of the list could have interesting repercussions for Netflix -- not the least of which is validating its increased spending on original content. Morgan Stanley analysts said that the SVOD provider's estimated 2016 budget of $2.5 billion outpaced that of HBO, which will likely spend $1.8 billion on its original content efforts.
Of course, top Netflix competitor Amazon is likely spending quite a bit on its original content efforts, and while that paid off during awards season -- Mozart In The Jungle took home two Golden Globes, for example, while Transparent was nominated -- it perhaps has not yet paid off in terms of viewership.
The Morgan Stanley report runs counter to a November study by Parrot Analytics which found that HBO's Game of Thrones series alone was the most popular original content out of 15 series analyzed. Rather than relying on a survey, the study used a combination of social listening methods, streaming site rankings and file-sharing activity, among other data, to give each series a rating. HBO topped other services in the U.S. with an average rating of 68.70, while Netflix trailed with an average of 64.02 for its selected original content.
Netflix is also becoming the bigger household name -- not just for OTT streaming but for entertainment in general. A March report by MoffettNathanson forecast that the SVOD provider's "U.S. total streaming hours relative to traditional TV will steadily rise to the low double-digit range over the next four years, and will continue to represent half the declines in traditional TV viewing."
Furthermore, a recent report by Salesforce and Harris Poll found that 61 percent of millennial-aged consumers, 46 percent of Gen-Xers, and 24 percent of baby boomers have purchased a streaming service like Netflix or Hulu if their communications service provider didn't offer a similar service.
Source: Salesforce Research 2016 Connected Subscriber Report
The rising rate of adoption among age groups signals that viewers are becoming increasingly attracted to the content options available from online streaming services – and are perhaps seeing premium services like HBO, even with its own OTT wing, less as the bastions of quality or edgy original content and more as equal competitors to Netflix for their viewing time.
- see this Variety article
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