Pay-TV customers who ¨stack¨ a streaming video service on top of their traditional cable or satellite subscriptions are more satisfied overall, according to new market research from J.D. Power. While cord stackers were the most satisfied, overall satisfaction was lowest among ¨cord cutters.¨
The inaugural study measures six criteria to determine overall satisfaction among those who have used a subscription pay-TV or transaction-based streaming video service within the past six months.
The number of Americans who have cut the cord on their traditional pay-TV services continues to grow, but the majority of OTT subscribers still subscribe to a traditional service in addition to an OTT video streaming service.
Sixty percent of streaming services customers are “cord stackers,¨ according to J.D. Power. Another 23 percent are ¨cord shavers¨ who have downgraded their pay-TV subscriptions while 13 percent are outright ¨cord cutters.” Another four percent have never subscribed to a pay-TV service and subscribe to a streaming service, J.D. Power highlights in a news release.
The market research specialist highlights the following results:
- Satisfaction Lowest among Cord Cutters: Overall satisfaction is lowest among cord cutters (802), followed closely by cord nevers (807), while satisfaction is highest among cord stackers (826) and cord shavers (822). Satisfaction in all measures is lower among customers who do not have cable/satellite TV than among those who do, with an especially wide gap between the two segments in the content measure (40 points).
- Binge-Watching High: Nearly two-thirds (62%) of customers use a streaming service to binge watch—the act of watching multiple episodes in succession—TV programming. Overall satisfaction is 35 points higher among those who binge watch vs. those who do not (834 vs. 799, respectively). As binge-watching sessions increase in duration, so does overall satisfaction: 823 among those whose most recent session lasted less than four hours; 841 among those whose session lasted 4-8 hours; and 858 among those whose session lasted 8 or more hours.
- Television Remains Primary Viewing Device: Nearly two-thirds (65%) of customers view streaming content through their TV; 55% view content on a laptop/desktop computer; and 48% view content on a mobile device. More than half (56%) of viewers use multiple devices to watch streaming video.
- Original Content Viewership Higher among Streaming-Only Subscribers: More than half (54%) of cord nevers and 49% of cord cutters view original content vs. 43% of cord shavers and 41% of cord stackers.
“The streaming video customer experience appears to be stratifying across the different subscriber segments, with pay TV service still having a major effect on the overall streaming video experience,” commented Kirk Parsons, senior director and technology, media & telecom practice leader at J.D. Power.
Demographics in part explains this effect, Parsons continues. ¨Customers who only stream are younger than those who also have TV. Nearly two-fifths (37%) of customers who only stream are 18-34 years old, compared with 30% of those who also have TV. Notably, 52% of cord nevers are 18-34.
¨Also, streaming-only customers are less likely to use transaction-based streaming services, which perform higher in the content measure.”
Turning to streaming video providers, respondents ranked Netflix the highest with an overall score of 829 on a 1,000-point scale. Netflix lead or tied with the highest score in five of the six metrics and performed particularly well in performance and reliability and in customer service. Hulu Plus followed closely at 821, one point above the industry average. Cost of service and communication were strong points for Hulu Plus.
J.D. Power’s latest research results echo those of ZoneTV CEO Jeff Weber, who spoke at Telecompetitor’s recent broadbandTV event. Pay-TV providers need to embrace OTT in order to adapt to the changing pay-TV landscape, Weber, who once lead AT&T’s U-verse business unit, commented.
“It will evolve and it needs to evolve, but I think the pay-TV industry is going to be around for a long time, it offers a lot of value to consumers,” Weber said in an interview. “But the pay-TV space needs to address what consumers want.”