Report: Netflix Barely Maintains U.S. Market Share Advantage Over Prime Video

While Netflix is still considered the most indispensable subscription streaming VOD service worldwide, with just a 2% churn rate through the end of 2023, the streamer’s market share domination in the United States is shrinking, according to new data from Indian-based LatentView Analytics.

The company found that the streamer ended last year with 77.3 million North American subscribers, accounting for 21% of the domestic SVOD market. That compared with Prime Video ending last year with less than 80 million subs and 19% market share. The report found Prime Video (21%) edged Netflix (20%) in viewing hours market share.

Regardless, Netflix continues to dwarf the competition in annual revenue ($31.6 billion) and profitability ($5.4 billion). Prime Video had $5 billion in revenue and unknown profitability.

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Separately, SVOD rival Max gained in overall market share (15%), which the report attributed to “consistent execution” of original movies and series, which ended driving up the subscriber count to 50 million.

About 95% of U.S. households had at least one SVOD service at the end of 2023, and on average access to 5.2 different streaming services, including online TV, free ad-supported streaming TV, and ad-supported VOD, according to LatentView.

“Retaining and attracting subscribers remains the key challenge,” read the report. “The value of the service relates to the content variety, diversity provided by the platform and user experience.”

Market share in the report is as follows:

  • Netflix: 77.3 million North American subs, 20% viewing hours market share, $31.6 billion  in revenue, 21% subscriber market share.
  • Prime Video: 80 million subs, 21% viewing hours market share, $5 billion,  19% sub market share.
  • Max:  50 million subs, 15% viewing hours market share, $6 billion, 15% sub market share.
  • Disney+: 46.3 million subs,  13% viewing hours market share, $5.5  billion 15% subscriber market share.
  • Hulu: 48 million subs, 11% viewing hours market share, $10.7 billion, 10% sub market share.
  • Apple TV+:  39 million subs, 6% viewing hours market share, $2.2 billion, 7% sub market share.
  • Paramount+: 48 million subs, 7% viewing market share, $1.2 billion, 4% sub market share.
  • Peacock: 31 million subs, 2% viewing hours market share, $830 million, 2% sub market share.
  • Starz: 26 million subs, 1% viewing hours market share, $1.4 billion, 3% sub market share.

Antenna: Domestic 2023 SVOD Sub Growth Dropped 50%, While Churn Tripled

Growth of premium SVOD subscription tiers dropped more than 50% to 10.1% in 2023 from 21.6% growth in 2022, according to new data from Antenna. Last year saw 19.3 million more gross subscriber additions and 36.2 million more cancelations than in 2022, which translated to 17 million fewer net subscriber additions.

Antenna found that total SVOD subscriptions in the United States approached 243 million at the end of 2023. Peacock, Paramount+ (both up 1%), and Netflix drove the most of the sub growth, while Netflix held its market share (26%) for the first time since 2019.

With continued subscriber growth comes increased churn, or subs that don’t renew on a monthly basis. The data suggests that the churn rate has tripled over the past four years to 5.5%. Peacock saw the greatest improvement in churn and Starz saw the greatest increase. Netflix maintained it’s industry-low churn rate at just below 2%.

However, subscribers dropping service do come back to the same or similar SVOD platform — underscoring the consumer appeal of month-to-month access compared with long-term contracts, according to Antenna. Indeed, nearly a quarter of canceled accounts return to the service within three months, and more than 40% within 12 months. About 30% of SVOD gross sub additions in 2023 were returning subscribers, meaning these users had canceled service within the prior 12-month period.

Apple TV+ saw the highest instance of returning subs at 37.2%. The returning Netflix rate fell from 35.2% to 26%, driven by the password crackdown, which led to many first-time sign-ups by individuals who had previously used the service for free (password sharing) through another person’s account.

Peacock and Netflix saw the greatest number of returning subscribers, with 30% of cancelations resubscribing by within 90 days. After a year, 50% of Peacock and 46% of Netflix canceled subscribers had returned to the respective services.

About 39% of SVOD subscriptions are in their first year, with the percentage rising to 45% when excluding Netflix. More than 51% of the 95 million first-year SVOD subscribers are in the first 90 days of the service — the period of highest possible churn. The probability of canceling service drops from 9% in the first 12 months to 4% in the second year.

NPAW: Global Daily VOD Use Grew 12% in 2023

More people are watching video-on-demand content on their televisions.

Following two years of decline, the time the average user spends watching content per day increased globally in 2023 by 12% for VOD and 4% for linear TV content, according to new data from NPAW, a video streaming analytics company.

The findings, released in the company’s 2023 Video Streaming Industry Report, revealed a significant year of engagement and quality improvements for the industry.

In the second half of last year, daily user engagement for VOD and linear TV grew 4% and 3%, respectively.

NPAW suggests the data signals an increase in consumption or a shift in the consumers’ attention toward a more selective number of streaming platforms.

Episodic content continued to dominate as the primary type of VOD content, capturing 67% of the total global TV viewership. However, movies saw a slight increase, accounting for 26% of all VOD minutes streamed in 2023.

Additionally, last year saw significant improvements in the quality of video streaming, with a global decrease of 38% in the buffering ratio, and regionally, with regions like Asia experiencing an 18% increase in the average bitrate. These percentage improvements suggest there is still room for optimization of the streaming video experience.

At the device level, big screens extended their dominance in total playtime by 8%, driven by the growth of smart TVs. The data reaffirms that consumers overwhelmingly prefer big-screen TVs when streaming video content, reserving smaller-screen devices such assmartphones for casual streaming, social media video or while on the move.

“​​These findings underscore a significant year of renewal and growth for the streaming sector,” Ferran Vilaró, CEO of NPAW, said in a statement.

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NBC Sports: GolfPass Membership Platform Tops 100 Million Total Minutes Streamed, Includes Free Access to Peacock

NBC Sports Next’s GolfPass, a subscription program offering tee-time benefits and streaming video, touted its fifth anniversary, announcing the platform has generated more than 100 million total minutes of streaming video content consumption.

 

Co-founded by PGA Tour star Rory McIlroy, GolfPass ($99 per year) offers subs access to an on-demand video library of nearly 5,000 videos ranging from golf instruction to a variety of original entertainment. The service features 115 series, including 84 originals, representing more than 3,000 episodes and 40,000 minutes of entertainment, including shows “Ask Rory,” “The Conor Moore Show,” “Build a Better Game,” “Home Course Advantage,” “Better Off With Hally Leadbetter” and “My Daily Routine,” among others.

The service also includes 795 one-to-two-minute instructional videos.

A record 45 million Americans played golf in 2023, according to the National Golf Foundation.

Also included in the membership is access to the Golf Channel video vault, featuring series “Feherty” and “Big Break.”

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The streaming service is now on the Peacock platform, with Samsung TV Plus adding a GolfPass channel to their programming mix in 2022, with Xumo, Amazon Freevee and TCL soon to follow. Roku became the most recent addition in January, with two more distribution platforms expected in the near future.

Horowitz: Gen Z Consumers Use More Than 6 Streaming Services, Prefer Professional Video Content

Generation Z, the 13-24-year-old demo with a penchant for streaming YouTube videos and social media, is growing up — at least when it comes to their entertainment content choices. New data from Horowitz Research finds that the Gen Zers are heavily engaged with professional, full-length TV content.

The study — based on an online survey of 812 Gen Z respondents — suggests Gen Z audiences are almost as likely to be viewers of professionally produced TV content as they are non-professional content (e.g., short clips, user-generated content, video game live streams, videos on social media). About 80% of the demo report watching short- form videos weekly, while 70% say that they watch TV content every week. The data are similar for both older (18-24 year-old) and younger (13-17 year-old) Gen Zers.

More than half of Gen Z consumers typically watch professionally produced, long-form TV content on their TV sets, while more than 33% say they usually consume TV content on their smartphones.

Not surprisingly, the smartphone is the most coveted portable device, used among 65% of the Gen Z demo to watch non-TV content. Yet, about 20% usually watch non-TV/short-form content on their TVs, with older members of the Gen Z demo watching more content on the TV screen.

Horowitz found that the average Gen Z streamer accessed more than six streaming services, up from five in 2020. Usage of free ad-supported streaming TV (FAST) services is on the rise, with the Roku Channel, Tubi, and Pluto TV being the most popular FAST services among this demo.

The most popular TV content genres included movies, animated series/cartoons (not anime), dramas, and music-related content, with older consumers reporting higher viewership across most of these genres than younger users.

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“What is interesting to us is thinking about how [Gen Z] might bring their short-form behaviors to the big screen, and to their expectations when viewing long-form content and what that might mean from a content development, user experience, and revenue perspective,” Adriana Waterston, EVP and insights and strategy lead for Horowitz Research, said in a statement.

Horowitz is hosting a free webinar on Gen Z’s behaviors around video content, social media, and sociopolitical issues, and how brands can engage with them.

Content Overload is in the Eye of the Streamer

A recent guest blogger on this site lamented the time he spent looking for content to stream across his various streaming services. He longed for an app that would simplify content choice back to the days of the weekly TV Guide magazine, when you could count the number of watchable TV channels on one hand.

The blogger needn’t worry. Help is already here. Just a few clicks away.

While Netflix co-CEO Ted Sarandos long ago admitted there was more streaming content available than any one person could consume in a lifetime, finding something watch is not difficult. It’s actually easy thanks to recommendation algorithms and email marketing already employed by most streaming platforms — as well as reading Media Play News.

You just have to act upon the data right in front of you.

I’ve been binging a lot of crime reality lately, including shows such as “48 Hours,” “20/20,” and “Dateline” across Paramount+, Hulu and Peacock.  I’m now inundated with similar programming across Prime Video, Netflix and Max. Streaming one episode of “48 Hours” on my laptop has resulted in an avalanche of similar content available on YouTube.

A downside to those algorithms is often finding the same crimes repackaged with new headlines and a slightly different narrative across a different streaming platform. Nothing worse than realizing you already know who committed the murder!

That said, content alternatives are as plentiful and easy to find as scrolling the TV screen or reading an email. Peacock today sent me the following message: “What do you feel like?” with the following interactive buttons: “I’m looking for drama,” “I want to laugh,” “I want to dive deep,” and “I’m feeling spontaneous”. Upon clicking a button I was directed to a handful of programming I could begin streaming immediately on my laptop or TV screen.

The process took a few seconds.

Netflix has launched a sizable selection (30 titles) of 1970s movies it licensed from Universal Pictures, Warner Bros. Pictures and MGM, which include, among others, the 51-year-old actioner Charley Varrick, starring Walter Matthau, Black Belt Jones, the 1973 Blaxploitation film starring Bruce Lee sidekick Jim Kelly, and Oscar-winning One Flew Over the Cuckoo’s Nest with Jack Nicholson.

I chose Charley Varrick (Matthau never disappoints) after about two minutes of scrolling.

Media Play News posts weekly updates from JustWatch.com, Reelgood.com, Samba TV, Nielsen and Netflix showcasing the most-popular movies and TV shows streamed that week. Each chart is like a virtual Top 10 TV Guide.

Reelgood today sent separate charts outlining the top “quality” and “high quality” TV shows streaming in January based on IMDb.com recommendations. It also charted the number of movies and TV shows each streaming service offers per dollar spent on a subscription. Hulu, Netflix and Prime Video sequentially offer the most TV content for money spent on a subscription. Prime Video offers the most movies.

Today’s “TV Guide” may be supersized algorithms, but content selection really just revolves around making a decision and clicking a button.

Ampere: Studio Streaming Video Profitability 18 Months Away

Handwringing about money-hemorrhaging streaming video platforms could soon be an issue of the past, according to new data from Ampere Analysis. The London-based research firm says studio-based streaming services should be profitable within the next 18 months.

 

After investor sentiment towards direct-to-consumer streaming video soured and studios implemented a series of cost-cutting measures, the ability for the streaming businesses of Disney (Disney+), Warner Bros. Discovery (Max), Paramount (Paramount+) and NBCUniversal (Peacock) to achieve quarterly profitability is within reach, according to Ampere.

Guy Bisson

While some studio streaming operations have already reported small profits (Max), Ampere is looking for consistent profitability, taking into account income from subscription and advertising offset by content costs, staff and marketing costs, depreciation, and amortization to predict the point that businesses reach consistentl\ pre-tax earnings.

Ampere predicts that Disney+ is likely to get there first, as early as the first quarter 2024 (two quarters ahead of company projections). Max will follow, reaching consistent profitability by Q3 2024 with both Paramount+ and Peacock achieving that goal by Q1 2025.

By 2028, studios will generate from $1 billion and $2 billion in pre-tax income a year from streaming video based on current market conditions. Additional geographic expansion would lead to even more upside.

“The analysis shows that [direct-to-consumer] is not a broken business model, but an important revamp of an existing content exploitation window,” Guy Bisson, executive director at Ampere Analysis, said in a statement.

Bisson contends that studios are now able to position streaming as a profit-making window that is complimentary to theatrical exhibition, transactional and broadcast — sectors that had previously been deprioritized.

“Profitability of the streaming model, which will be driven by advertising, will also see an acceleration of free streaming, including Free Ad-supported Streaming Television (FAST) channels,” Bisson said.

Ampere reports the shift in fiscal fortunes among studio streaming platforms has been driven by cost rationalization around content and staffing, and the embrace of advertising dollars. The latter also providing a wild card opportunity for significantly more growth and profit than currently predicted by business models based on existing operations.

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Bisson believes that a confluence of factors, ranging from the end of the pandemic, geopolitics and inflation, forced studios to reassess the return on investment of the streaming direct model. The cost cutting over last 12 months has now positioned the industry for streaming profitability in relatively short order, according to Ampere.

“[This] will enable a return to flexibility and experimentation, and a realization that existing [business] models are already in place to fully exploit studio output when streaming direct takes its rightful place as one window in the broader value chain,” Bisson said in a statement.

Digital TV Research: Asia Pacific SVOD Market Expanding Despite U.S. Services’ Diminished Presence

The Asia Pacific subscription streaming VOD market is projected to reach $49 billion in revenue by 2029, up from the $34 billion in 2023. This comes despite a rapidly maturing Chinese market, the world’s second largest, and India experiencing SVOD shake-up, according to new data from Digital TV Research.

China will account for 39% of the region’s total revenue by 2029, down from 47% in 2023 as other countries grow their SVOD markets faster. China is reaching SVOD maturity, with a poor ad-supported VOD sector at present. India’s SVOD sector was disrupted by Indian Premier League cricket converting to AVOD in 2023 after Disney+ Hotstar lost IPL streaming rights.

Asia Pacific’s SVOD revenue already overtook AVOD revenue in 2019. AVOD will recover, but will remain lower than SVOD. SVOD and AVOD revenue will climb by $4 billion and $9 billion respectively between 2023 and 2029.

The big six U.S.-based platforms, including Netflix, Prime Video, Disney+, Max, Apple TV+ and Paramount+ will account for only 18% of the region’s OTT revenue by 2029 – the lowest proportion for any region.

Market leader Netflix added 1.88 million Asian Pacific subscribers in the most-recent fiscal period, to end the period with 42.43 million.

“Disney now appears less keen on expanding Hotstar to the region’s developing markets as it is classified as a ‘non-core’ asset,” analyst Simon Murray said in a statement. “Warner Bros Discovery is yet to announce international plans for Max. And the Paramount+ Asian rollout will be very limited.”

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Horowitz: Consumers Value Curated Hubs to Discover Content

In an increasingly fragmented streaming ecosystem, consumers are gravitating toward curated collections and hubs to find content based on a specific theme, according to new data from Horowitz Research.

About 80% of 2,200 survey respondents questioned in April said they watch curated content more often than not.

Notably, the survey found that the majority of multicultural streamers use curated collections to focus on content they value. Among ethnic groups, 80% of Black streamers use Black content collections/hubs occasionally (similar by age). Among Asian streamers, 65% watch Asian content collections/hubs. Among LGBTQIA+ consumers, 52% of streamers report using LGBTQIA+ curated content.

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Overall, about 80% of respondents said they have used curated collections to find new, just released content; popular/most watched content; and content based on viewing history. Additionally, more than 50% of streamers have watched holiday content based on curated collections.

“Professional curation, such as these hubs or collections, are playing an increasingly relevant role in easing some of those struggles consumers are facing,” Adriana Waterston, insights and strategy lead at Horowitz, said in a statement. “These are particularly useful for diverse audiences, who are relying on hubs or collections to more easily identify culturally resonant content which is still very much in-demand and yet not always easy to find.”

Streaming Video Supplants Cable/Satellite Viewing in Vizio TV Households

A majority of Vizio smart TV owners now stream video entertainment rather than access legacy cable or satellite TV distribution, according to new data from Inscape, which tracks ACR data from millions of Vizio TVs.

Looking at the second fiscal quarter over the past three years, streaming has captured 9.7% of viewing share from cable/satellite for U.S. TV households, according to the report. As a result, streaming’s share of viewing has increased from 44.1% in Q2 2021 to 53.8% in Q2 2023. Meanwhile, cable/satellite’s share has fallen from 46.9% to 37.1% during the same period, while gaming and over-the-air antennae viewing share has remained relatively consistent during this time.

A rise in availability and consumer usage of streaming apps and free ad-supported TV (FAST) services has made streaming the “new normal” in media consumption, according to Inscape. This is also underpinned by the continued penetration of smart TVs themselves.

Indeed, by early 2022, streaming had displaced cable/satellite as the most-viewed TV source by U.S. households, according to Inscape. In the quarters since, it has steadily grown its share of viewing time and there are no signs of a slowdown.

The report found that FAST, which offers a free, easy entry experience across a wide variety of curated programming, continues to gain popularity among consumers. FAST viewing time increased by 70% from Q2 2022 to Q2 2023.

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“As the viewing landscape continues to shift, marketers, measurement providers and media owners alike need to understand where and how consumers are connecting in order to create and implement the best strategies to reach them and drive optimal business outcomes,” read the report.