Has Streaming Maxed Out Its Subscriber Base?
Stalling Growth
According to data insights and consulting company Kantar, 86% of US households subscribe to a video streaming service. While the number increased substantially in Q4 2021, this quarter’s growth has been much more muted, with sign-ups expanding overall by less than one-percent.
Digging into specific companies, Amazon Prime Video (AMZN) saw its market share decline by 3% in the most recent quarter. Meanwhile, HBO Max (WBD) increased its sign-ups by 12% and Paramount+ (PARA) grew its subscriber base by 9%. The biggest headlines have surrounded industry-leader Netflix (NFLX), as its subscribers shrank for the fifth-straight quarter, representing a 4% decline over the preceding 12-months.
CNN+ Makes Quick Exit
Less than a month after the launch of CNN+, executives decided to pull the plug, as the subscription-based streaming-news platform struggled to gain solid footing. The decision was made after CNN changed hands from AT&T to the recently-created Warner Bros. Discovery, as the result of a merger.
From its start date on March 29th, CNN+ failed to rise above 100,000 subscribers. Executives at Warner Bros. Discovery reportedly felt the service’s $5.99 per month cost was too high and would result in middling growth. Executives have said some CNN+ content could end up on the HBO Max streaming service.
Why Subscribers Cancel
Kantar’s “Entertainment On Demand” study looked at why people cancel streaming services. The data firm says people struggle to find content they want to watch, adding that many users cancel after consuming a specific series or film. Kantar notes this is different from what’s going on with Netflix, as price increases seem to be driving its subscriber fluctuations.
The explosion of new streaming platforms could lead to more “switching” between services, as opposed to consumers “stacking” several different subscriptions at once. Kantar argues this means platforms will need to successfully market certain titles in order to retain customers. With so many options to choose from, and only so many dollars to spend, it seems retention is more important than growth for streaming in 2022.
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