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On a Netflix free trial? A third of you will likely pay up

Nearly one out of three people who try out a video-streaming service during a limited free period end up subscribing, according to new research.

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Online video services like Netflix offer free trials are a lure for new members.

Netflix

Almost one out of three people who use a free trial to try out a streaming video service end up subscribing, researcher Parks Associates said Monday.

That "sizeable portion" of trial users dwarfs the amount of people who abuse free try-outs, Parks senior analyst Glenn Hower said.

"There is a potential for free trial abuse, but only roughly 1 percent of consumers are 'serial trialers,'" he said. "Most consumers use trials for their intended purpose of trying out a service before deciding whether or not to continue as a paid subscriber."

Services, such as Hulu, Netflix and live-TV streamers like Sling TV, often offer a free period, one of the consumer-friendly patterns that have become standard for online video competitors -- and have made it easier for people get a sense of life as a cord-cutter. Traditional TV providers like cable and satellite have grappled with dwindling customer growth as more people opt for online alternatives.

The data was released Monday as part of Parks' OTT Video Market Tracker, ahead of a presentation at the NAB Show trade show in Las Vegas.

According to Parks, more than a fourth of US broadband households tried out at least one online video service in the last six months with a free trial. Of these, 47 percent subscribed to at least one trial service after the free period expired.

Most households build their services around at least one of the top three services: Netflix, Amazon, and Hulu, according to Parks. Those three also have some of the most effective rates of converting free users to paid.

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