The television industry is on the road of a major upheaval. The way streaming services continue to grow, cable TV chords are getting cut by the dozen.
Network programming which includes a slew of content channels such as sports, news, entertainment and lifestyle is seeing a steady decline in its viewership. Some of the largest media conglomerates that run cable network programming all over the world like 20th Century Fox, Disney Time Warner, Sky & CBS all continue to hit low ratings. (Source BCG here.) It is no wonder that a large share of the broadcast consumer market is shifting to the digital ecosystem. OTT players like Netflix, Amazon Prime, Hulu and others are climbing the curve with their brand of easy-to-access original content available to viewers anywhere and anytime on their smartphones. And if you add user generated content platforms like YouTube and Instagram to the mix, consumers have more streaming options than ever before.
So with an eye on this trend, the natural step would be for such companies to transition to OTT. Here are some reasons why Cable TV owners need to embrace the digital revolution:
1. The Price Comparison
Cable subscription costs continue to spike every year. As of 2020, the average household cable package is near $217 dollars per month (Source Decision Data here.) This is grossly more than the average household spend for all other major utilities combined. Compare this to the OTT streaming sites and their costs are far lower. An average subscription plan per month could cost anywhere as low as $5.99 to $11.99 per month (Source CNBC here.) So in the battle of prices, this clearly helps identify why consumers are opting for OTT.
2. The Digital Technology
Most countries are now equipped with the robust infrastructure that is needed to meet the demand for online video streaming. The rise of new online and mobile solutions and the increasing cloud-based ability to provide on-demand services, traditional television is feeling the pinch. It can be said that smartphones and tablets are infact the new TV sets in this digital revolution. High speed internet and improved wireless connectivity are a lucrative draw to content creators. Not to mention with nearly a billion new handheld gadgets that will be sold by 2023, content creators are finding innovate ways to reach their viewers directly on their mobile screens.
3. Budget Productions
Young media houses and an average independent content creator are challenging the norm that high-quality content requires it to be expensive. Entertainment programs produced by well-known cable networks that draw millions of viewers have a proportionately high production expense. This is easily defied by a platform like YouTube where content creators are able to garner tens of millions of views for each of their videos made on a very modest budget. The same qualifies for OTT apps that receive tens of millions of downloads. This shows that content is no longer the dominion of those with deep pockets.
4. Following the Demographic
SurveyMonkey (source here) in a survey of 500 Americans found that half of the respondents who reported watching cable TV were 60 years and older. 31% of the 18–29 year olds said they watch both cable TV and streaming services and 27% of 18–29 year olds said they prefer streaming services. This goes to show that cable TV is not a popular medium with the youth. The maximum amount of online content is consumed by the 18–35 year olds that make up for about 2 billion people on the planet. This make them the default target audience and the easiest way to reach them is through OTT.
In conclusion, if you are a cable TV operator who is looking to bite a chunk of the OTT pie, look no further. Enveu is here to help. Connect with us right away!