Services like Netflix and Hulu have gotten a boost from older subscribers this year, and it could mean traditional TV will erode faster than expected
- A new Ampere Analysis report shows that subscriptions to SVOD services have grown this year after plateauing in previous quarters.
- Ampere senior analyst Toby Holleran attributed the growth to traditional, older consumers switching to streaming.
- Holleran also cautioned companies against forcing bundles on users in the future.
Subscriptions to streaming services are growing again after a plateau in the US thanks to a boom in Netflix and Hulu subscribers this year.
According to a report from Ampere Analysis, subscriptions to streaming video on-demand services (SVOD) were steadily increasing from Q3 2015 until Q1 2017, when numbers began to stagnate. Subscriptions have been consistently rising, though, since the beginning of this year.
Ampere senior analyst Toby Holleran told Business Insider that traditional viewers, an older generation that was rooted in pay TV, are beginning to catch on to the benefits of SVOD services.
"Traditional users were more ingrained in the pay-TV space and there was slightly less awareness of SVOD during that period [of plateau]," he said. "Whereas now, especially with older demographics, we're starting to see more and more growth in those. I feel the plateauing was taking place among younger demographics because they formed such a large proportion of the overall SVOD base, whereas now with older demographics slowly familiarizing themselves with SVOD, that's actually starting to grow again."
That coud be bad news for pay-TV companies, which could see cord-cutting accelerate if older generations see a viable alternative in streaming.
Exclusive content is also key for streaming services, Holleran said, as Netflix has been heavily investing in its catalog of original content in an effort to have 1,000 TV original shows and movies by year's end. Hulu also has acclaimed shows like "The Handmaid's Tale," which won the Emmy for best drama last year.
As the SVOD landscape rapidly evolves, more players are entering the game. Disney is set to launch its own competitor late next year and is already developing Marvel and "Star Wars" TV series for it. AT&T recently announced that it would also roll out a service next year that would include HBO.
This could lead to a new form of SVOD bundle, but Holleran urged caution in that regard.
Holleran said the best course of action for streamers is to give users as many options as possible for the best price, rather than forcing bundles on subscribers.
"I think forcing bundles upon people might not be the best move," Holleran said. "It depends on the price point. Additional costs may turn away consumers who may only want to take one service."