So here we are in 2013 surrounded by subscription film rental services and the rise of OTT TV (Over The Top TV). For those who have not encountered OTT TV, it means a TV service delivered using another connection, e.g. you might have your broadband with BT Retail but actually watch movies via a NOW TV subscription on your Xbox 360. We wanted to see whether the belt tightening as everyone sees costs like the daily commute to work rocket has had an impact on the older fashioned subscription TV services and also see to what extent services like NetFlix and Lovefilm Instant have become mainstream.
The survey generated 1,200 responses and gives an insight into what people who are interested in broadband are doing with regard film and TV spending. The first question was looking to see if the overall spending on film and TV had increased and for 22% of those answering they are spending more than they did a year ago. With 70% saying that their spending stayed the same or answered No (which would include those spending less), the next poll question which looked at spending on Virgin Media and Sky TV services should provide some further insight.
Some 20% of people appear to be reigning in their spending on the traditional cable and satellite services. The large chunk that was 26% with no opinion reflects those who do not subscribe to either of these content platforms. We may in the future try and look in more detail into what people have dropped from their packages, it may simply be that many are abandoning multi-room subscriptions or not reducing the channel line-up but ditching the £10 per month extra charge that HD carries on Sky TV.
It is probably no surprise that a website with a focus on broadband would have lots of visitors that use or have used Lovefilm Instant or Netflix, with 26% of those taking part in the poll saying they subscribe now, or have done so in the last 12 months. If these OTT TV services were to replicate this with the wider population they would have around 6 million subscriptions in the UK.
A common complaint about Internet TV streaming services is the constant re-buffering. Netflix generally avoids this by adapting the picture quality on the fly, whereas Lovefilm Instant can tends to still buffer in the middle of playback on a variable performance connection. What will be interesting to see is whether in 12 months time the take-up of OTT TV services has changed significantly particularly as more people subscribe to a super-fast service.
The general conclusion from the poll is that Sky and Virgin Media are not losing out to Netflix and other services just yet, but there are signs that people are willing to try the new services and while the new entrants may not have the latest movies, at a price point of £5 to £6 per month compared to the £16 for Sky Movies this may change. If the streaming services can launch streams that utilise 6 to 10 Mbps of bandwidth they will match the quality level that Sky and Virgin Media can offer.
The interesting cat amongst the pigeons is the new Clubcard TV service from Tesco and while it is does mean putting up with adverts, it is free and effectively puts an end to the bargain bin DVD section where you would pick up a six year old film for £3, why pay £3 when you can watch it for free.
Perhaps the question that now needs to be asked is whether people who use peer to peer systems to get hold of films and TV series for free are now happily paying the fairly low subscription fees for the OTT TV services. One aspect that may be helping reduce peer to peer usage is that many US TV services now air at the same time in the UK, or have a minimal gap, e.g. Game of Thrones Season 3 airs on 31st March in USA and plays out on Sky Atlantic on the 1st April in UK.