OTT a 'Credible Threat' to Pay TV

According to Strategy Analytics, over-the-top (OTT) a la carte TV channels such as HBO Now, CBS All Access and/or services such as Sony Vue TV and Sling TV present a new threat to pay TV. With a VOD service over the Internet, subscribers can simply pay for channels they want to watch instead of being required to pay for several channels they do not and offer a cheaper alternative to watch live TV, choose which packages to add on, no contract, no installation or setup fees, and the ability to watch on demand, on any device.

Consumers surveyed in the United States and UK also found Sling TV's setup process easy and intuitive and its TV menu clean and easy to use, the research house says. Device incentives such as 50% off Roku or a free Chromecast to encourage service adoption are appealing to many. However, current pain points of the Sling TV service include the need to offer more channels to choose from; the inability to watch the service on two different devices simultaneously; no access to local channels such as ABC, NBC and CBS, etc.; and the limited number of devices that the service can actually be used on - access is currently only via streaming or personal device, and there is no smart TV app.

Diane O'Neill, Strategy Analytics' director, User Experience Innovation Practice, wrote: "A la carte TV is a credible threat to cable/satellite TV .... (T)hese types of services will become more in line with traditional cable/satellite packages and perhaps be more compelling due to cost effectiveness and importantly, the ability to remove content that users consider to be of no relevance to them."