Why is the Netflix Watch Instantly Service taking off when other over-the-top (OTT) video delivery services are languishing? The short answer: Because Netflix makes it easy to watch content on both the PC and the TV, according to a new study from The Diffusion Group (TDG).
Michael Greeson, founding partner for the new media research firm, didn't initially set out to answer that questionhe was conducting a larger study on TV everywhere servicesbut the data he found on Netflix users was so compelling, that he decided to spin it off as its own report.
"Streaming is one thing, but streaming to the TV is a whole different equation," Greeson says. "Those that do this are the bleeding edge of video consumers. They constitute the early over-the-top crowd, but people know very little about who this demographic is."
What first caught his attention is how many Netflix subscribers use the Watch Instantly service. Nearly two-thirds of Netflix members with broadband connectivity use the instant streaming option, either on their computer or television. Also impressive is that half of the Watch Instantly users stream video to their TVs.
The study, which was done without any cooperation or input from Netflix, also looked at how the company could improve revenue with new streaming services. It found that 37 percent of users would pay extra for the streaming service they were currently getting, 59 percent would pay more for access to new releases, and only 24 percent would pay extra for mobile access. That's the direction Netflix seems to be moving, Greeson says, with tiered streaming services that deliver different content.
The real lesson of the report is that taking risks with online content can pay off. "Don't be afraid of getting your content online and streaming it to the television," Greeson says. "Don't be afraid of the over-the-top model. Learn how to master it." The current shift in video viewing is only a threat to companies that are standing still, he says.
"If they're not leaders, like Netflix, they should at least be paying attention," he adds.