A pair of recent market research studies indicate that subscription video on demand (SVOD) takers and the number of services they subscribe to will continue to climb in the five years ahead, even as viewers grow weary of stacking disparate service fees.
According to research released by Digital TV Research last week, the number of U.S. SVOD subscribers is forecast to reach 450 million by 2026.
Meanwhile, DVR-resource TiVo’s recent Second Quarter Trends Report offered up consumer polling showing that on average North Americans are now taking 8.7 different video services, up 26% from Q4 2020, and better than half of them feel it necessary to actively evaluate and adjust their entertainment spending at least twice a year.
Further, TiVo’s survey of 4,500 North America respondents found that 25% reported canceling an SVOD or live streaming service over the past six months, while 81% indicated they would prefer free, ad-supported streaming to subscribing to an additional paid service.
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TiVo’s study found that people of all ages continue to cut the cord to traditional pay-TV service, but younger age groups are using a greater variety of streaming services. TiVo’s report indicated people ages 18-30 use 11.3 different services, while those 51 and older use about 5 services.
This has led to a new conundrum for younger viewers, as they subscribe to a greater variety of different services to create their own content bundles 55% of those surveyed said they had reached their spending limit and can’t afford to add any additional streaming services.
TiVo said 70% of consumers surveyed aren’t sure if they are actually saving money by switching to streaming services from a traditional provider.
The study also found navigating all of these service might be getting cumbersome requiring AI tools: Of those TiVo polled, 71% owned a smart TV, up 11% from Q4-2020, and among those who acknowledged using voice search features in their devices, 88% said they use it at least twice a week.
Meanwhile, Digital TV Research’s North America streaming SVOD market study forecasts gross SVOD subscriptions for movies, linear channels and TV episodes (not including sports) to rise 33% in the United States from 338 million at the end-2021 to 450 million in 2026.
About 87% of TV households (106 million) will subscribe to at least one SVOD platform by 2026. This compares to 82% of TV households (99 million) subscribing to at least one SVOD platform by end-2021.
The average SVOD household will pay for 4.26 SVOD platforms by 2026, Digital TV Research said. The average SVOD subscriber will pay for 3.42 SVOD platforms at the of end of 2021. That means the average SVOD home will add about one paid subscription between 2021 and 2026, the market research study shows.
Simon Murray, Principal Analyst at Digital TV Research, said: “We have substantially revised our forecasts to reflect recent market developments. For instance, we have markedly increased our subscriber numbers for Amazon Prime Video, HBO Max and the “others” category.”
The report covered 22 streaming platforms across the United States and Canada.
Among the SVOD market share leaders Digital TV Research forecasts in the U.S. will be (see chart above for Digital TV Research’s predicted subscriber volumes): Amazon (moving into the top spot over the period), Netflix, Amazon, Hulu/Hulu Live, Disney+, HBO Max, Peacock, Paramount+, Starz, Showtime, Apple TV+ and others.
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By Greg Tarr
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