Kagan: Loss of Content Driving Decline in Multichannel Market

Customers are following content toward OTT services.
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MONTEREY, Calif.—The content landscape is shifting, as the days of certain channels only being available on specific multichannel platforms are fading. This will factor into the accelerated long-term losses for multichannel services per media research group Kagan.

OTT-Panels

As more and more OTT services become available from different networks and studios, multichannel video subscriptions are losing the exclusivity of content that they previously held. This leads some consumers to drop the multichannel services in favor of OTT, causing the number of online-only households to rise.

Despite this, Kagan reports that the majority of households (64%) by 2023 will still rely on either traditional or virtual multichannel services for video entertainment. However, the arrow will likely be pointing downward overall.

Kagan forecasts that in 2023 the total traditional multichannel subscriptions will see a decrease of 16.4 million subscribers as well as a dip of traditional residential multichannel households of 15.6 million. Virtual multichannel households are expected to rise by 6.4 million to 13.5 million total, but the combined amount of subscribers for multichannel services is expected to be down overall to 84 million residential subscribers.

Meanwhile, alternative services like OTA is projected to see a rise of 3.8 million to 21 million total, while online-only households could see a bump of 10.6 million to 25.2 million total.