MarketLine Blog

YouTube TV expands its presence in the US: Changing consumption patterns reduce demand for cable TV

A major shift is currently underway as an increasing number of consumers switch over from cable/satellite TV to online streaming. 61% of young adults for example today watch TV online, as compared to around 10% of the 50-64 age group. YouTube therefore in April 2017 launched its live online streaming service in five major urban areas in the United States. The service has seemingly been a success as by the end of the year, it has been expanded to more than 80 urban areas across the US.

YouTube TV provides viewers with access to more than 50 live channels of various genres, ranging from news and sports, to entertainment and business. The channels can be viewed on a wide range of devices such as smartphones, laptops and via internal apps on smart TVs as well. The price of $35/per month for six private accounts means that the price is rather affordable as well.

It is likely that YouTube TV will be expanded to international markets in the coming years as well. Currently the company seems to be testing the reaction in the US market before it ventures abroad. Given the way in which it has expanded its service in 2017 in the US, the trend suggests that there is in fact strong demand for the service in the country. However the trend of switching over from cable/satellite TV to online TV is not only limited to the US, but also can be observed in many other parts of the world. Success within the US will hence encourage the company to expand the service abroad as well.

Overall YouTube TV will be a success quite simply because the strong brand image of the company, coupled with the changing consumption trend puts it in the long in an ideal spot to benefit from increased sales. Today’s teenagers and young adults will be tomorrow’s wage earners and hence customers. An early entry into the live streaming market will hence place YouTube in an ideal position to take full advantage of the time when these young adults and teenagers form the bulk of the buyers in the market.

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