Nearly 7 in 10 (69%) of TV content viewers in the United States use free streaming services at least monthly, a sharp increase from 42% in 2019, according to Horowitz’s latest State of Media, Entertainment & Tech: Subscriptions 2023 study.
The rapid growth in usage of free streaming services is driven by the number and variety of free, ad-supported streaming TV (FAST) services, which offer linear content in addition to their on-demand libraries, according to Horowitz. The free services consumers in the survey are using most are Peacock, Tubi, Pluto and YouTube.
On the subscription streaming (SVOD) side, with self-reported total average spending on these services at more than $50 per month, data from the Horowitz study indicate that there is a growing appetite for managed services to control costs. In 2019, over half of cord-cutters felt they were saving “a really good amount”; in this current study, that number dropped to 33%. And, already, 1 in 3 (30%) consumers indicate that they pay for at least one of their streaming services in combination with another service they have (e.g., as a bundle with another SVOD service, through a service such as Amazon Prime, as a perk with a cell phone plan, etc.).
Meanwhile, after years of decline in MVPD subscriptions, penetration of traditional cable/satellite services seems to be remaining steady. Consistent with last year, half (52%) of TV content viewers subscribe to MVPD services and customer satisfaction with their service overall among those subscribers is high, at 80%.
Satisfaction numbers have increased slightly over the past few years as less happy customers abandon MVPDs for streaming options, while MVPD loyalists, who derive a lot of value out of the service, remain subscribed. Notably, 1 in 3 cord-cutters (32%) say that if the cost of all their streaming services continues to increase, they might consider going back to cable.
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“The data from this year’s study points to some important opportunities for media companies and consumers,” noted Adriana Waterston, chief revenue officer and insights and strategy lead for Horowitz Research, in a statement. “The adoption of AVOD/FAST services — and the concomitant increase in streaming ad revenue we can expect to see — will help offset revenue loss on the linear side, which is critical as programming costs continue to skyrocket.
“On the consumer side, managed services, in which subscribers can see and manage all their streaming content in one place, would be an antidote to the challenges inherent to today’s highly fragmented streaming space, and consumers seem open to consolidating their services. It’s a matter of which companies will compete to be the managed services solution for the streaming age, between traditional MVPDs and tech companies like Amazon, Samsung, Roku, and Apple.”
The State of Media, Entertainment & Tech: Subscriptions 2023 report surveyed 2,200 adults.