NEW YORK (TheStreet) -- The digital streaming video space is exploding. Some 68% of U.S. television viewers now use a streaming subscription service to watch TV shows and movies, compared to 41% in 2014, according to Hub Research.
And there are plenty of players in the space: Netflix (NFLX) - Get Report, Amazon (AMZN) - Get Report Prime Instant Video; Hulu Plus; Time Warner's (TWX) HBO NOW; CBS' (CBS) - Get Report Showtime; Apple's (AAPL) - Get Report iTunes; Sling; Vudu and Google (GOOG) - Get Report Play, among others.
But is that too many? "I don't think there are too many right at this minute, but I think we're getting to that point where we're bumping up against consumer's budgetary constraints," said Paul Verna, senior analyst at eMarketer.
The costs add up, especially if you're a fan of Orange is the New Black on Netflix, Game of Thrones on HBO and Homeland on Showtime. Netflix and Hulu Plus cost $7.99 a month. Amazon Prime costs $8.25 a month, which includes Amazon Prime Instant Video. HBONow runs $14.99 while Showtime costs $10.99. The average pay-TV cable bill stands at $123 a month, according to NPD Group.
Analysts say consumers are likely to focus on five video streaming services, at most. But which ones are poised to win?
For starters, Netflix dominates, with 46.4% of Internet users flocking to Netflix, compared to 16.7% for Amazon Prime and 10.1 % for Hulu Plus, according to Digitalsmiths. Netflix also has an early mover advantage, having launched its streaming service back in 2007. Amazon Prime Instant video debuted in 2011.
"I think Amazon definitely is playing catchup, but I think if you look at the success of Transparent, that show is now in the zeitgeist in the same way House of Cards and Orange Is the New Black have been for Netflix." Verna added.
While it's going to be a tall order for any streaming service to eclipse Netflix, which boasts 65 million subscribers worldwide, experts say there's still plenty of room for other players.
According to a new report from PwC, some 53% of those age 8 to 11 say streamed TV was their favorite type of programming. "Netflix, Amazon and Hulu -- they all do have a very heavy focus and a robust offering for kids and family," said Christopher Vollmer, principal, media & entertainment at PwC's Strategy & Digital Services. "The logic behind that is you want to get in and build early relationships with the next generation of users."
Changing the viewing habits of young people by offering niche content on a flexible schedule is poised to pay huge dividends for companies like Netflix and Amazon.