Generation Y’s appetite for streaming media is driving subscription content to new levels of consumption, according to fresh audience research from Mintel.
Generation Y’s appetite for streaming media is driving subscription content to new levels of consumption, according to fresh audience research from Mintel.
According to the report, nearly half of all online adults (46%) in the US watched video content in the previous month using a subscription video account, while 71% of all 18-34s were viewing online in the same period. Mintel forecasts that total sales will reach over US$16.7 billion by 2018 as consumers shift away from physical discs and seek out more unique content.
Netflix has emerged as the front runner for subscription usage, with around a quarter of all U.S. households holding a Netflix subscription. Mintel’s survey reports that 36% of all adults had used it in the past month, more than three times the usage of the nearest competitor.
The differentiator in consumer choice is increasingly being driven by the development of original production with Netflix’s House of Cards and Orange is the New Black leading the trend. Netflix has produced over 20 distinct pieces of original programming, including television series, movies, documentaries and stand-up comedy performances. Eleven new television series are in development, set to air in 2014 or 2015. Hulu aired 20 original exclusive series in 2013, and has 40 additional series in development. While Amazon Instant Video started offering original TV programming in November 2013.
"Virtually every large cable company, telco, or hardware and software brand is joining the streaming video market and we're seeing big deals being put on the table to enhance viewers' experiences," said Billy Hulkower, senior technology analyst at Mintel.
The research found that while 41% of respondents were only interested in watching television shows or movies online if they are provided free of charge, 59% are open to paying directly. Advertising based freemium models are also losing their charm with only 24% opting to sit through commercials in order to view for free.
In other demographic findings, higher levels of penetration and consumption include men and respondents from households with children. Men tend to consume more streaming video with 27% of men watching a program nearly daily, compared to 19% of women. While, 55% of households with children either rented or purchased a digital movie or TV show in the past month, whereas only 20% of those without children did so.
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