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Report: Crackdowns on Password Sharing Impacting SVOD Churn

Report: Crackdowns on Password Sharing Impacting SVOD Churn

Recent efforts by Netflix, and soon Disney+, to crackdown on subscribers sharing their passwords with non-members is contributing, along with price hikes, to upticks in churn, according to new data from Horowitz Research.

A survey of survey of 2,202 adult respondents conducted in January-February 2024 found half of TV content viewers (52%) have canceled or lost access to at least one of their SVOD services within the past year. Among those who cancelled or lost access within the past 12 months, the main reasons cited include efforts to cut subscription costs, recent price hikes, and perceived lack of value for the cost. Notably, almost 33% who canceled said not being able to share or borrow a subscriber’s password was a contributing factor.

The crackdowns and rising prices are having an impact on consumers’ wallets: About one third (35%) of streamers surveyed said that they are paying more this year than they were last year for streaming services, and the self-reported average spend on SVODs increased from $49.33 in the 2021 study to $60.60 in 2024.

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As a result, Horowitz found that 59% of respondents are receptive to ads if it means paying less for their subscriptions. In fact, now that Netflix has been offering a $6.99 tier with ads, almost 1 in 3 streamers in the study who have Netflix say they are on the ad-supported tier of service.

Still, almost 1 in 4 (23%) streamers plan to cancel one or more of their subscription streaming services in the coming months, an increase from 19% who intended to churn in 2023. Among those who plan to cancel, Netflix is the service most often mentioned as being on the chopping block.

“To avoid churn, subscription streaming services will need to focus on smart windowing strategies to keep audiences consistently engaged with their content and be proactive about helping consumers downgrade to lower-priced and/or ad-supported tiers as soon as they see a subscriber’s viewership and engagement dropping,” Adriana Waterston, EVP of insights and strategy at Horowitz, said in a statement.

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