Netflix subscribers watch less live TV, more catch-up

Friday 14 August 2015 | 11:47 CET | Background

Subscribers to Netflix in the Netherlands watch less linear TV than other households, according to figures from the Telecompaper Consumer Panel. The trend has been signaled in the US as well. Netflix customers watch less live and recorded TV and prefer more downloaded or DVD content. 

In the second quarter of 2015 around one in seven Dutch households subscribed to Netflix. They watch almost a third less live TV than households without Netflix, equal to around half an hour less per day. They also watch 10 percent (4 minutes) less of recorded content. 

Other forms of video consumption are popular among Netflix users, including catch-up TV. Netflix users catch up on recent programmes 20 percent more (6 minutes) than consumers without Netflix. They also watch internet content (7 minutes) and content obtained through downloading or DVDs more (9 minutes). 

In total, Netflix subscribers watch an average one hour per day of Netflix or other over-the-top (OTT) video-on-demand (VOD) services, such as NLziet or Videoland Unlimited. That is 57 minutes more per day than non-Netflix subscribers, showing that the audience for other OTT video players in the Netherlands is still very small. 

Paying for a subscription video-on-demand (sVOD) service, such as Netflix, appears to lead to more use of T-VOD (transactional video on demand, or pay per view). Netflix subscribers spend on average 20 minutes per day watching T-VOD films or service via their TV provider or services such as Pathe Thuis. This is 33 percent (5 minutes) more than households without Netflix. 


No cord-cutting yet in Netherlands

While TV penetration may be falling in the US, as signaled by PwC in a recent report, the 'cord cutting' trend is not yet visible in the Netherlands. The number of TV subscriptions has only risen in recent years in the country. Among 20-29 year-olds, 7 percent say they don't have a TV subscription, and this falls to 1 percent of 65-80 year-olds. 

In anticipation of consumers considering ending their TV plan, providers have started introducing 'skinny' bundles, with fewer channels. KPN is testing the service Play, Tele2 started the TV light plan, and Lebara introduced its Play online service. These packages offer only the most watched channels for a reduced price (KPN and Tele2), or focus on a specific target group (Lebara).

The money saved on the standard TV package can go to purchasing OTT services. This so-called 'cord shaving' is still at a very early stage in the Netherlands. In the US, where TV packages are much more expensive, the trend appears well under way.

More and more (s)VoD services

More and more VoD services are starting in the Netherlands, some on a subscription basis and with a wide range of content. KPN is expected to launch later this year the earlier mentioned Play service, which offers films, series and live streaming of a number of channels. HBO, which also has its own VoD service, will provide premium content for Play.

Lebara Play launched in July with an offer of around 150 channels and 3,000 films, with some content free and some premium content. With support for 13 languages, the service targets immigrants groups such as Turks, Tamils and West Africans in Europe. TV Light from Tele2 offers only the 20 most popular channels in the Netherlands, including the public, RTL and SBS channels, as well as Eurosport, National Geographic and Discovery Channel.

The NPO announced in April plans to launch its own VoD service that would also include older "timeless" programmes from the public broadcaster. This is in addition to its existing services NPOgemist (free catch-up) and NPOplus (paid). Other VoD services on the market include MyPrime from Ziggo and Kijk from SBS.

More Dutch streaming

More Dutch consumers stream films, series and other TV programmes than download video content, according to the Samsung technology barometer released in July. The survey conducted earlier this year among 1,000 Dutch consumers found that 56 percent stream video content, 12 percent points more than in the previous survey in 2014. The share who download video content fell to 44 percent.

Among those who stream video content, four in ten do so at least once a week. A fifth said they stream films, series or other TV programming daily via (subscription) video-on-demand services.

Strong increase in video streaming revenues

Revenues from OTT (over-the-top) TV and video services in West Europe are expected to reach EUR 12.4 billion in 2020, compared to an estimated EUR 5.7 billion this year and just EUR 807 million in 2010, according to Digital TV Research. The market researcher expects 55.66 million households to subscribe to a sVOD service in 2020, up from 1.66 million in 2010 and 15.29 million in 2015. This is equal to over 32 percent of West European households in 2020 and 9 percent at the end of 2014. The penetration is expected to reach 36 percent in the Netherlands and as high as 51.8 percent in Denmark.

More information about the Dutch TV and video market will be available in the upcoming Telecompaper report ‘Video behaviour of Dutch consumers 2015 Q2’.

This research is based on the Telecompaper Consumer Panel. The survey was conducted in April – June 2015 (n=2,527). Panel participants are aged 12-80, and results are stratified according to age, gender and education. For more information about research opportunities with the panel, please contact research@telecompaper.com.

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