Original content a key driver of OTT, SVOD growth in Europe, US

It should come as no surprise that OTT service adoption continues to accelerate in the United States, but a new report says uptake in Europe also has increased, especially of free services being offered. A primary driver? Unique content that isn’t available anywhere else.

International data from Parks Associates shows 70% U.S. households now watch at least one streaming service with an increasing number of households subscribing to multiple services.

“In the U.S. and Canada, the quickly increasing volume of new options is driving high numbers of online viewing of TV and movies,” said Brett Sappington, director of research at Parks. “Each service is bringing new experiences for consumers, and many are providing new content that is unavailable elsewhere.”

AT&T, Sony, and HTC have been the most recent to announce new OTT video services in the U.S. market, and Spotify recently added video to its freemium OTT music service. PlayStation Vue also recently became available nationwide across the U.S., and at a lower price than it originally launched at.

“Consumers are trying and subscribing to more services,” Sappington said. “We saw a big increase in the number of households subscribing to multiple OTT video services in the U.S. market at the end of 2015.”

But, Sappington said, services like iPlayer in the United Kingdom, along with Netflix, Sky and Amazon, are increasing awareness and interest in the U.K. where OTT video usage has expanded to 55% of U.K. broadband households.

France, too, has seen usage rise to 51% of broadband HHs as more services – including a new TVOD video service from retailer FNAC have launched, joining Netflix and other more established services.

Parks said Western Europe has seen an overall increase in OTT usage.

The number of paid subscriptions in Europe, however, is significantly lower than in North America. Just 30% of broadband households in the U.K. and 17% in France subscribe to paid streaming services, compared to 64% of U.S. broadband households.

“OTT is definitely gaining traction across Europe. We are seeing new OTT video services spring up but not as many as in North America,” Sappington said.

Pay-TV penetration is lower in many European countries than in the U.S. with more over-the-air channels and DTT channels available, as well as free online options like the BBC iPlayer.

But, Sappington says, as more paid streaming options – with more unique content – enter the market, video-viewing culture in Europe also will evolve.

Netflix, Amazon and other SVOD services have become more aggressive in developing their own content, with much of it scoring well with subscribers and critics. Netflix alone has 600 hours of original content planned in 2016 from 31 new and returning originals, documentaries, comedy specials and 30 shows for children. It also plans to release eight feature films this year. The company put six shows on IMDB’s Top 10 shows last year alone. HBO this year also said it would up its game, matching Netflix with 600 hours of fresh content.

Stay tuned.

Jim O’Neill is Editor of Videomind and Principal Analyst at Brightcove. You can follow him on Twitter @JimONeillMedia and on LinkedIn