With Prime Video joining Netflix, Disney+, Max, Paramount+ and Peacock offering lower-cost ad-supported SVOD options, new data from Bango shows that ad-supported subscription tiers are driving gains for more expensive ad-free options.
The launch of ad-funded tiers has driven more than a third of U.S. SVOD subscribers (36%) to upgrade their plans to ad-free.
With 31% of subscribers saying they’ve canceled at least one streaming service because ads were introduced, another 78% say that paid-for SVOD plans should never display ads. The data is based on an online survey of 5,000 SVOD subscribers in the United States.
According to the Bango, acceptance of ad-supported SVOD varies across different subscription types. While 35% of video streamers have paid for an upgrade to avoid watching ads, this percentage rises to 48% among music subscribers. For those streaming sports content, the percentage increases to 71% opting to upgrade when ads are introduced into their services.
Separately, the report found that 35% of survey respondents who had previously freeloaded off an existing user’s account are now paying for streaming service.
While Netflix, Disney+ and others services have cracked down on shared passwords, more than a third of respondents (35%) still regularly jump between streaming platforms, pausing and restarting their subscriptions to access the content they want.
Meanwhile, with last year’s launch of the Verizon +play, the all-in-one subscription streaming video trend dubbed “Super Bundling,” has found competing services such as Netflix, Starz, Max, and Paramount+, among others, linking together similar to the Disney+, Hulu, ESPN+ bundle. According to the data, this represents a welcome trend for subscribers, with 73% saying they want one platform to manage all of their subscriptions in one place. Another 69% would also like the ability to pay for multiple subscriptions via one monthly bill.
At the same time, SVOD subs are wary of a return to a cable TV business model, with less than 30% respondents wanting their cable company to manage their subscriptions. Instead, half of subscribers (50%) say they want their cell phone provider to launch a content hub. The majority of these (61%) would even pay a higher cell phone bill to receive this service, with the average subscriber willing to pay an additional $364 per year (+19% of their annual bill).
Paul Larbey, CEO of Bango, contends consumer attitudes towards SVOD are changing, welcoming the flexibility ad-supported tiers bring to the table.
“People want choice,” Larbey said in a statement. “Those who are happy to watch ads accept them, those who aren’t pay a little extra. The important thing is that they have the freedom to choose.”
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