U.K. SVOD Market Nears 50 Million Subscriptions

Consumers across the U.K. had nearly 50 million SVOD subscriptions in 2022, according to data from the British Association for Screen Entertainment (BASE), which valued the sector at £3.8 billion ($4.7 billion), a 17.6 percent year-on-year gain.

The number of SVOD subscriptions rose by 6.4 percent last year, down from the 2021 gain of 28 percent and 2020’s whopping 44 percent increase amid the early days of the pandemic. Consumers have an average of 2.7 subs per home, up from 2.3 in 2021. An audience base of 16.2 million U.K. households use at least one online video service. One in 20 households in the U.K. took out a new online video subscription in the last three months of 2022.

In SVOD, the top title of the year was the premiere episode of Netflix’s Harry & Meghan (4.5 million views in the first seven days.) Prime Video’s top title was Lord of the Rings: The Rings of Power, with 3.2 million views in its first week. Obi-Wan Kenobi topped the charts at Disney+, with 3.1 million views in week one.

The overall value of the U.K. home-entertainment sector across SVOD, digital, DVD sales and rentals rose by 14.3 percent to £4.43 billion ($5.45 billion). BASE puts the value of the U.K. screen industry at £11 billion ($13.5 billion) when also including cinema and pay TV, a 12 percent year-on-year growth.

BASE has bullish forecasts for the FAST sector in the U.K., projecting it will be the second-largest in the world by 2027 with a value of $500 million.

The top home-entertainment title in 2022 was Top Gun: Maverick, with 1.6 million sales across VOD, EST, Blu-ray and DVD, followed by Spider-Man: No Way Home at 1.4 million. PVOD and PEST saw the release of 51 titles last year, a 6.3 percent increase, with 35 days after theatrical as the average window. In the TV charts, House of the Dragon was on top, followed by Doctor Who, Mrs. Brown’s Boys and The Crown.

TVOD overall grew in value by 6.1 percent to £132 million ($162 million). Warner Bros. Discovery was the leading transactional distributor across physical (34 percent market share) and digital (17.8 percent).

Liz Bales, chief executive of BASE, noted, “U.K. home entertainment is now a model of complementary channels and their successful co-evolution benefits savvy audiences. The top transactional titles are shown to perform across all platforms—13 titles in 2022 sold over 100,000 units on both EST and DISC. After a period of phenomenal growth in the last few years, subscription rates are clearly slowing, but the introduction of ad-tiers to traditionally SVOD services like Disney+ and Netflix demonstrates the agility of our category to provide consumers with more affordable options amid the ongoing cost-of-living challenges. It also creates a significant new advertising revenue stream outside of traditional subscription and transactional revenues for the platforms, bolstering total industry revenue and allowing continued investment in future content, while driving the potential for further subscription growth by giving consumers more options.”

James Duvall, principal analyst and head of entertainment at Futuresource Consulting, added, “A return to a full year of new release content in 2022 has helped ensure the digital transactional market moves back into growth, even though U.K. consumers are struggling against rising inflation and increased energy costs. The latest blockbuster cinematic content, award-winning originals and an ever-growing array of ways to watch movies and TV means that consumers have a rich vein of content available at their fingertips, evident by the YoY growth in spend across box office, pay TV and SVOD.”