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March 9, 2022
Posted August 15, 2021

SVOD Subscriptions Are Higher Than Ever — Here’s How to Interpret the Stats

author
Adrian Pennington
Jennifer Aniston, Courteney Cox, Matthew Perry, Lisa Kudrow, David Schwimmer and Matt LeBlanc in “Friends: The Reunion” on HBO MAX
Jennifer Aniston, Courteney Cox, Matthew Perry, Lisa Kudrow, David Schwimmer and Matt LeBlanc in “Friends: The Reunion” on HBO MAX

A new piece of research confirms what we’ve been expecting: The world may be coming out of its pandemic-induced haze, but customer desire to be snuggled up under a blanket in front of their favorite on-demand content has never been greater.

Researcher JD Power says that the mass quarantine of 2020 has acted as the impetus for a shift in customer behavior that will forever alter the way content in consumed.

In fact, while the a la carte nature of streaming could lend itself to less customer spending, it appears the inverse is happening. The more choices, the more temptation to get access to a specific library.


CONNECTING WITH CONNECTED TV:

Currently one of the fastest-growing channels in advertising, Connected TV apps such as Roku, Amazon Fire Stick and Apple TV offer a highly effective way for brands to reach their target audience. Learn the basics and stay on top of the biggest trends in CTV with fresh insights hand-picked from the NAB Amplify archives:
  • The Ever-Changing Scenery of the CTV Landscape
  • TV is Not Dead. It’s Just Becoming Something Else.
  • Converged TV Requires a Converged Ad Response
  • Connected TV and the Consumer
  • Connected TV Opens Up a Million Ad Possibilities

Viewers increased their streaming subscriptions to an average of 4.5 streaming providers in June 2021 from 3.9 streaming providers in December 2020, the survey finds. Meanwhile, the average monthly household spend on all streaming services increased commensurately to $55 from $47. That’s up a whopping 45% since last April.

What accounts for that change in spending? Report author, Ian Greenblatt, MD of TMT Intelligence at JD Power One, fingers one culprit as price increases.

READ MORE: Despite Return to ‘Normal,’ People are Spending More Time and Money on Streaming Services Now than During Height of Pandemic (JD Power)

Netflix got the ball rolling in October 2020, increasing the price of its premium service. In March, Disney raised the price of Disney+ to $8 a month, or $80 per year. Disney has also given ESPN+ two price increases this year, the second which goes into effect on August 13, which has forced the service’s annual plan increase by about $20 this year alone.

“Streaming services continue to add value to justify any past or future hikes,” Greenblatt says. “The race for big intellectual property has intensified, as each platform looks to gain a leg up on what it can offer its customers.”


CHARTING THE GLOBAL MARKETPLACE:

Big content spends, tapping emerging markets, and automated versioning: these are just a few of the strategies OTT companies are turning to in the fight for dominance in the global marketplace. Stay on top of the business trends and learn about the challenges streamers face with these hand-curated articles from the NAB Amplify archives:
  • How To Secure the Next Billion+ Subscribers
  • Think Globally: SVOD Success Means More Content, Foreign Content and Automated Versioning
  • How Does OTT Gain Global Reach? Here’s Where to Start.
  • Governments Draw Battlelines To Curb the US Domination of SVOD
  • Streaming Content: I Do Not Think You Know What That Word Means

Among them: Disney $400 million per year seven-year pact to air NHL, some of which will air on ESPN+; Peacock’s deal with Universal to bring its movies to the platform no more than four months after theatrical release; Netflix plan to stream games on the platform within the next year.

“And that’s on top of the increasingly ambitious original programming slate that each service continues to pursue,” Greenblatt says.

Separate hardware platforms like Roku, Apple TV and Chromecast also got sizable boosts for reasons that could run the gamut from retrofitting a non-connected TV to make it “smart,” or accessing services that may not be available on specific brands of smart TV.

“Streaming services continue to add value to justify any past or future hikes. The race for big intellectual property has intensified, as each platform looks to gain a leg up on what it can offer its customers.”

— Ian Greenblatt

Surveying the responses of more than 1200 US adults to subscription-based services, J.D. Power finds 79% of people are spending the same or more time streaming than they did six months ago.

Of shows, that debuted in the May to June period it was season 5 of Lucifer that was the most streamed show helping Netflix+ maintain its industry-leading market share.

And critically panned it may have been, but the Friends Reunion special seems to have done the numbers for HBO. Not only did an estimated 29% of streaming households watch is premiere on HBO Max, but the trip back to Central Perk also helped give the original show a signal boost. Friends was the third-most streamed show in June, which helped boost HBO Max to a 41% subscription rate among respondents, up from 22% in December and trailing only Netflix, Amazon Prime, Hulu, and Disney+, per the survey.

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