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Why streaming services like Amazon Prime are beating cable

Netflix vs. Hulu vs. Amazon vs. Cable

Have you ever walked into the office, only to catch yourself in the middle of a discussion from last night’s episode of Game of Thrones? And during a recent night out, did your date ask what shows you watch on Netflix?

The world of instant streaming is becoming a necessity, not only for self-entertainment but also for connecting with others. As signs have pointed toward a shift in fully embracing instant streaming, we’ve become curious to understand how the trend is evolving and why it’s happening.

To find some answers, our research team surveyed over 1,300 adults across several demographics, asking questions around their preferences and behaviors for watching television and movies.

Interested in running your own research? Learn more about your target market’s background and preferences using SurveyMonkey Audience.

Here’s what our research tells us:

Over half (52%) of our respondents would pay for streaming services only. This is pretty striking if you think about it. The respondents aren’t just saying that they prefer streaming services over cable, or would rather stream only as opposed to bundling it with cable. They’re saying that streaming services alone are worth paying for.

This trend is most popular amongst millennials, where more than two-thirds (69%) would prefer to cut the cord and only pay for streaming services.

Yes, Netflix is undoubtedly a leader in the online streaming space, thanks in large part to their original programs, but individuals are diversifying the platforms they use to watch shows and movies.

When asking our panel which platforms they watch videos on, we found YouTube and Netflix to be on top (watched by 59 and 56% of respondents respectively), followed by Amazon Prime at 29% and Hulu at 20%. As three of these four platforms require separately paid subscriptions, it’s clear that viewers have an appetite for a diverse set of streaming options.

Millennials’ responses were once again magnified in comparison. Netflix and YouTube were still number one at 77%, but Amazon and Hulu jumped up to 34% and HBO Now/Go moved up to 27%.

Ok, so people prefer streaming services and are open to using several of them, especially among millennials. But why? Here’s a breakdown on the key drivers behind its growth:

Convenience: 64% of our respondents would gladly trade in an opportunity to watch a movie on the big screen for a chance to see it on their computer. In other words, despite a bigger screen, a chance to see the movie sooner and a night out with friends and family, the convenience and comfort of seeing it at home is too appealing.

Control: When using your TV, how often do you find yourself changing the channels, only to turn it off either, because nothing interesting comes on or the commercials start to get on your nerves?

Streaming services put the control in the viewer’s hands. Want to watch the next episode of ‘Bosch’ on Amazon Prime? Just visit the show’s page and click ‘next episode.’ Looking to watch the movie ‘Barry’ on Netflix now? Easy.

Nearly three-fourths (74%) of our respondents prefer to customize the channels and programs they watch, and with cable’s in-flexibility to pick and choose specific programs or remove unwanted commercials, streaming services come out on top.

Cost-effective: The demand for movies and shows is sky high. We see American adults watching 35 hours of television on average per week.

To meet demand, streaming platforms are offering a massive number of programs at a low cost. Amazon Prime for instance, has over 17,000 movies and television shows available at a cost of $8.25 per month, plus access to other benefits like free two-day shipping. Compare this with the average household cable bill of $103 per month and you’ve got yourself a deal.

The long term business viability for subscription streaming services looks strong. Why? Original programming isn’t the only priority for consumers.

57% of our respondents use streaming services for programs that have already been released. For millennials, the figure spikes up to 65%. This news may come as a relief to the companies that offer instant streaming as creating original programs often prove to be costly—Netflix plans on spending 6 billion dollars on original programming during 2017! The nature of consumer demand allows streaming platforms a chance to narrow their original content offerings to a few original shows/movies while focusing their attention on purchasing the rights to stream in-demand pre-existing programs.

What’s the takeaway from all this? People prefer to pay for streaming services only, oftentimes pay to use several streaming providers, and are more interested in watching pre-existing programs. As each of these factors point to the health of the subscription streaming market and are especially true among millennials, the trend toward using subscription streaming services looks set to keep growing.

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