June 5, 2020
Research from Ampere Analysis has revealed that one in seven online video households worldwide are ‘borrowing’ an account. Ampere defines an account borrower as anyone who says they are using a login for a subscription online video platform from someone outside of their household to access a service.
Borrowed services might include mainstream TV and film products such as Netflix, Hulu or Amazon Prime Video, but also include sports streaming services and niche content services. A silver lining for the OTT players is that most consumers using another household’s login say they would pay extra for a service that gives them the content they want. So, how should online video services turn these borrowers into buyers?
- In the past 12 months, the proportion of global Internet users that are borrowing an account has increased, rising from 8 per cent in Q1 2019 to 11 per cent in Q1 2020.
- Ampere estimates that there are 70 million households borrowing one or more OTT accounts across 22 markets worldwide.
- This represents roughly one out of every seven households which have access to a subscription OTT service.
- The trend is highest in India, followed by the Netherlands and France, and lowest in Japan.
- Account borrowing is growing fastest in the UK, China and Indonesia.
- Account borrowers are more likely than average to be younger and students. However, over 50 per cent have full-time jobs and household incomes on-par with the average consumer. This means that a large proportion of the group does have purchasing power.
- Sports programming is particularly attractive to a subset of account borrowers. In Europe, a greater proportion of users of sports services such as NBA League Pass and NFL Game Pass are account borrowers. This is partly due to the seasonality of sport. Account borrowing by these users is likely to only be for a specific period, or by casual fans who don’t feel they watch enough to merit paying for a subscription.
“We can see that households swap login details with friends and families to access other platforms, and we predict that as the subscription OTT landscape continues to fragment and consumers are faced with an increasing number of platforms to choose from, this borrowing behaviour will become more prevalent,” predicts Minal Modha, Consumer Research Lead, Ampere Analysis.
How will subscription OTT services respond?
Many of the borrowers are legitimate paying customers. Three-quarters subscribe to at least one subscription OTT service, representing over 50 million households. Additionally, two-thirds have pay TV at home.
With over half of borrowers saying they don’t mind paying extra for something that gives them exactly what they want, there could be an opportunity for subscription OTT players to convert borrowers to buyers. Already pay-TV operators and aggregators are providing bundles with built-in discounts. Following NOW TV’s example in the UK, services might offer cheaper one-off passes to allow casual viewers to dip in and out of their services without incurring high fees or being tied into an annual contract.
“With 50 million account borrowers paying for another subscription OTT service and more than two-thirds taking pay TV, it’s clear that these consumers are not averse to paying for content,” notes Modha. “Subscription OTT players need strategies to respond to an increasingly saturated market and entice consumers with a finite budget for content to pay for their programming – even if that means changing tack and allowing them to dip in and out of subscriptions or for bite-size chunks of content.”