U.K. Streaming Market Shrinks

A new study from Kantar has found that 1.51 million SVOD services were canceled by U.K. households in the first quarter, up from 1 million last quarter and 1.2 million in the same period last year.

More than half a million cancellations in Q1 were attributed to “money-saving” measures, Kantar’s Entertainment on Demand study says. Per Kantar, 16.9 million homes (58 percent) have at least one paid subscription, down about 215,000 on the previous quarter. The percentage of Gen Z homes subscribing to at least one SVOD service fell for the first time, to 74.6 percent, down from the peak of 75.8 percent in Q4 2021.

Kantar also reveals that only 3 percent of U.K. homes subscribed to a new service in Q1, as compared with 4.2 percent in the same period a year ago. Moreover, 38 percent of consumers plan to cancel SVOD services, primarily to save money, up from 29 percent in Q4 2021. The rate of inflation in the U.K. hit 6 percent in Q1.

The study reveals that Netflix and Amazon have been the most immune to consumers’ cost of living concerns, while Disney+, NOW, discovery+ and BritBox all saw “significant jumps” in churn rates quarter on quarter.

“With many streaming services having witnessed significant revenue growth during the height of Covid, this moment will be sobering,” Kantar said. “The evidence from these findings suggests that British households are now proactively looking for ways to save, and the SVOD market is already seeing the effects of this. As a result, it’s now more critical than ever that SVOD providers demonstrate to consumers how their services are indispensable in the home in what has become a heavily competitive market. New marketing and content acquisition strategies will likely need to be deployed to support this and avoid further churn.”

U.K. homes that pay for SVOD services now subscribe to an average of 2.4 platforms. Specific shows and films drive new subscriptions: in the last 12 months, the number of consumers stating they signed up to a service to watch a specific title has risen from 30 percent to 36 percent. In terms of share of new subs in Q1, Prime Video led the pack, thanks in part to Reacher, which was the most enjoyed streaming show across Great Britain in the period, ahead of Ozark and Inventing Anna on Netflix and The Book of Boba Fett on Disney+. Led by its Oscars success with CODA, Apple TV+ secured its highest ever new subscriber share, of 9.2 percent.