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OTT Video Services Had 41% Churn Rate Amid COVID-19, Parks Reports

Q1's churn rate for over-the-top video services was 41%, reported Parks Associates Monday. A March survey of 10,000 U.S. broadband households showed 76% subscribed to an OTT video service, and 62% to a traditional pay-TV service. OTT services filled in…

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the gap created by theater closures during the COVID-19 pandemic by adding new releases and extending free trials, noted analyst Steve Nason: It's unclear whether growth will be sustainable as lockdowns ease, “or if the OTT industry needs to adjust again to new viewing patterns." Of the 41% of households that trialed an OTT service, 69% adopted at least one, Nason said. "New trial offers can be successful in attracting new users, but as competition increases and household budgets shrink, providers will need to explore new service models, such as making a portion of content free or offering discounts to longer-commitment subscriptions.”