Stable subscriber counts for pay-TV services were once assurance for cable and satellite operators. Business is quite different these days. Consumers are now canceling or reducing their pay-TV subscription plans and opting for on-demand streaming. MoffettNathanson, a research and investment information firm, reports that US pay-TV services lost nearly a million subscribers across both Q2 and Q3 combined.

Price Waterhouse Cooper’s Videoquake 3.0: The Evolution of TV’s Revolution Report tracks intelligence on consumers’ changing relationship with content distribution offerings. PwC’s comprehensive research included two focus groups, 1,200 surveyed US Adults, 18+ and three months of social listening by examining social media mentions related to this topic.

The study reports that 79% of US consumers subscribe to some type of pay-TV bundle. Of these consumers, almost one-quarter (23%) reduced the size of their pay-TV package this year.  Cable and satellite operators are now offering customizable channel packages to try to stop subscribers from canceling or shifting to “over the top” (OTT) streaming services. After all, the average cable subscriber receives 194 channels and only watches 17; many ask why they should pay for more channels than they watch.

The migration to streaming is seamless given that 70% of pay-TV subscribers already have a subscription to a streaming service. The biggest players in streaming are Netflix, Amazon Prime, Hulu and HBO Go. The data also shows many consumers subscribe to more than one streaming service. For example, 65% of US consumers subscribe to Netflix and of these Netflix subscribers 52% also subscribe to cable and 55% also subscribe to at least one other OTT service. This is also the practice among Amazon Prime subscribers. Just over one-third (34%) of US consumers have an Amazon Prime subscription and among these subscribers 53% also subscribe to cable and 79% also subscriber to another OTT platform.

According to the PwC’s report, cost is the number one reason for canceling cable subscriptions, 57% of those who canceled their subscriptions reported they did so because “the monthly costs are just too high.” It’s not just the pay-TV subscription service that consumer pays for but also the set-top box rental. Ninety-nine percent of pay-TV subscribers pay for set-top box rental which averages to approximately $241 per year in a multi-television household. Streaming video, even multiple, has a much lower cost of entry.

Consumers are choosing to pay for the content they want and not being locked into paying for content they do not watch. As consumers’ relationship with content changes across services and screens, the market will need to continue to respond with relevant consumer options and business models.

Generation #hashtag is definitely changing the way we consume content. These consumers, regardless of their age, prefer native digital content, that is content and services designed and distributed exclusively through digital (includes mobile) channels. This generation now accounts for half of the entertainment audience (47%) and more than a third of the audience for online services (37%) and publishing (34%) according to Bain & Company’s annual research study conducted among 7,000 consumers in 10 countries.

The native digital experience introduces new digital monetization models as well such as single purchases, subscription and micropayments. Further, contrary to what many think, younger consumers are more willing to pay for native digital content than those older. For instance, 30% of consumers under age 26 are more likely to pay for some forms of digital videos versus 23% of consumers older than age 26.  This also holds true for digital music (34% of younger more likely to pay than 18% of older) and the purchase of games (40% of younger more likely to pay than 28% of older).

Traditional based models for content monetization rely heavily on the consumer and/or the advertiser to pay whereas digital native platforms often blend models. One such blended content offering is freemium where the product is offered free but any proprietary features and/or functionality will cost extra. Another example is crowdfunding where money is raised online via donors to fund a project that is would normally be a financed business venture.

Importantly when thinking of new monetization models keep in mind five key essentials: 1) content strategy, 2) distribution routes, 3) advertising models, 4) use of consumer data and 5) merger and acquisitions tactics. It’s imperative now more than ever that companies develop a native digital experience rather than digitizing already existing content and experiences.

A majority of Millennials regularly consumed paid news content in the last year, whether paid for by themselves or someone else, according to a new study on how Millennials get news conducted by the Media Insight Project, a collaboration between the American Press Institute and The Associated PressNORC Center for Public Affairs Research. Significantly, 40% of Millennials personally paid for news. This study is a deeper examination of a nationwide survey conducted in early 2015.

Some of the key findings of the study include:

• Socioeconomic differences are not a major indicator. The study found few socioeconomic differences between those who pay for news and those who do not.
• 87% of Millennials pay for some types of content, and the most popular services are movies and television (55%) and music (48%).
• Facebook and search engines are still the most common sources for obtaining news, even among those Millennials who pay for news from other sources.
• Almost than a third of respondents (29%) often get celebrity or pop culture news from a national TV network, its website, app or news alerts.
• More than a third (36%) say they often get sports news from a media organization that focuses on one topic (such as ESPN).
• About a quarter of those surveyed (26%) say they most often get traffic or weather information from a media organization that focuses on one topic (such as the Weather Channel).

The study was conducted by the Media Insight Project, a collaboration of the American Press Institute and The AP-NORC Center for Public Affairs Research. The study included multiple data collection approaches, including a web survey and in-depth interviews with small groups of Millennials to understand their news habits.

The survey was conducted January 5-February 2, 2015, and reached 1,045 adults nationwide between the ages of 18 and 34. Study recruitment was completed through a national probability mobile telephone sample, while the main portion of the questionnaire was administered online. The margin of error was +/- 3.8%age points. A full description of the study methodology for the survey and the qualitative group interviews can be found at the end of the report.