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Convenience, Cost and Content Power Netflix Uptake

Globally, Netflix subscribers expected to near 100 million by 2019

July 15, 2015 | Advertising & Marketing | Video

Netflix is nearing majority status in North America and the US. Digitalsmiths polling in Q1 2015 found that 46.4% of internet users in North America used Netflix—more than the 45.6% who didn’t use a digital video subscription service. Amazon Prime Instant Video trailed in a distant second, at 18.9%, while Hulu/Hulu Plus was the only other service to break double digits, at 11.4% of respondents. Similarly, a January 2015 study by Cowen and Company found that 40% of US internet users currently subscribed to Netflix, and in February 2015 research by Jacobs Media, 43.3% of internet users in North America reported using the video service at least weekly.

Reasons that US Netflix Subscribers Subscribe to Netflix, Jan 2015 (% of respondents)

Looking at the future, Digital TV Research Ltd. forecast in June 2015 that the number of paid Netflix subscribers in the US would reach 43.5 million by December 2015, up 20.1% from 36.3 million in September 2014. International subscribers were expected to hit 26.4 million, largely driven by Europe. Meanwhile, IHS Technology estimated in June 2015 that Netflix subscribers worldwide would total 96.5 million by 2019.

Why sign up? When Cowen asked Netflix subscribers why they subscribed to the service, 82% cited the convenience of on-demand streaming programming. The cost factor came into play, cited by 67%, while other respondents enjoyed the wide array of content and the ability to watch on any device.

US Cord-Cutter Households, 2010 & 2014 (% of respondents in each group)

While cord-cutting is still more hype than reality, figures released in March 2015 by Experian Marketing Services suggest Netflix subscribers are more likely to join in on the trend. The study found that 17.4% of US households that had high-speed internet and watched Netflix or Hulu didn’t have cable or satellite TV in 2014, up from 9.4% in 2010. This is compared with an average of 7.3% among total households, vs. 4.2% in 2010.

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