July 7, 2016 – Since 2008, the ability to “cut the cord” has existed with the help of devices allowing us to stream Netflix directly to our TVs. From 2008 to 2013, the idea that this technology could actually replace Pay TV (cable and satellite) seemed absurd. Fast forward to 2014 when the percentage of households using these devices rose from a mere 7% to a shocking 21%. Oh what a difference a year can bring. At this point, individual media groups, like CBS, FOX, HBO and many others, began to find ways to use these devices to benefit them monetarily. Once these groups got on board, it was clear that these media streaming devices were to be reckoned with. The next year (2015) the 14% rise between 2013 and 2014 seemed minuscule compared to the 31% spurt the media streaming industry experienced in 2015. With that, devices like Roku, Apple TV, Amazon Fire and Chromecast became serious contenders to the big dogs in the Pay TV marketplace.
None of these bigger than Roku, though. While Roku flies somewhat under the radar without a name like Apple, Amazon or Google backing it, the company has quietly moved it’s way into the top spot owning 37% of the Media Streaming Device market. Not only is Roku among the least expensive of the devices, but thanks to their deals with Sharp, TCL and Sceptre to be installed into their Smart TVs they are more readily available to consumers than the other brands they are competing with. Along with Chromecast, they also have to most to offer consumers as far as free content goes.
While Media Streaming Devices seem perfect for consumers, there are a few deterring factors that satellite TV companies like DirecTV and DISH hope will prevent the majority of consumers moving in that direction. The first factor is that many of the free channels actually do require a subscription to a Pay TV service. Channels like ESPN, Comedy Central and FOX are not available through these devices if you do not currently have a cable subscription set up. There are obviously ways around this. If one person has a cable subscription, they can surely share their subscription with others. This is a roadblock for some consumers, but the majority will find a way around this.
The larger concern is one of user experience and cost as it relates to the consumer’s internet service. In 2016, Netflix publicly stated that an internet speed of 5 Mbps or higher is required for a “regularly positive” streaming experience. This is not just true for Netflix, but for the media streaming industry in general. Unfortunately, those with DSL, satellite internet and even some smaller cable providers may not be able to experience streaming in a way that the service is meant to be due to slower internet speeds. Aside from speeds, another large concern is for those consumers whose internet plan has a hard cap when it comes to data. These services, especially in HD, can be big time data drainers as they take up 3 GB of data per hour. This could make streaming a costly option.
While there are negatives, it’s clear that these services are serious contenders and are here to stay.
Have you been looking into cutting the cord? If so, take a look at the infographic below provided by InternetChoice.org to decide which platform would be best for you!
Jessica Ward is a blogger, DIY addict, coffee snob and marketing extraordinaire at InternetChoice.org. She writes about technology, fitness, marketing, and whatever fills her mind with wonder and fuels her passion. Follow her on Twitter @jessward87