The number of people subscribing to at least one video streaming service in Great Britain has fallen, with more than 1.5 million people cancelling memberships, a new report has found.
Market research firm Kantar said that more than half a million cancellations were due to the cost of living crisis, as households deprioritise streaming services as they try to make ends meet.
A total of 1.51 million cancellations happened in the first quarter of 2022.
Roughly 58% of Brits now have at least one paid streaming service, such as Netflix, Amazon Prime Video or Disney+.
During the COVID-19 pandemic and the government enforced lockdowns, there was a surge in subscriptions to platforms, with more people stuck at home.
However, the report has found that the proportion of consumers planning to cancel subscriptions due to tightening budgets has risen to its highest level ever, from 29% to 38%, in the last three months of 2021.
In the report, Kantar said homes stated that one of the primary reasons for cancellations included “wanting to save money”, adding households were “starting to seriously prioritise where and how their disposable income is spent”.
‘Sobering’ news for the streaming industry
Kantar’s Worldpanel Division global insight director, Dominic Sunnebo, said the latest market research is “sobering” for the streaming industry.
“The evidence from these findings suggests that British households are now proactively looking for ways to save, and the SVoD market is already seeing the effects of this,” he said.
“As a result, it’s now more critical than ever that SVoD providers demonstrate to consumers how their services are indispensable in the home in what has become a heavily competitive market.
“New marketing and content acquisition strategies will likely need to be deployed to support this and avoid further churn.”
The report also found that Amazon Prime’s thriller Reacher, starring Alan Ritchson and Willa Fitzgerald, was the most-streamed show between January and March 2022, followed by Ozark and Inventing Anna on Netflix.
Kantar said “churn” rates increased across all streaming services but there was a “clear difference” in the number of cancellations outside Netflix and Amazon.
“Netflix and Amazon can be seen to be hygiene subscriptions for Brits; the last to go when households are forced to prioritise spend,” Kantar said.
“Disney, Now TV, Discovery+ and BritBox all saw significant jumps in churn rates quarter-on-quarter.”
Advertising could help revenue growth
New subscriptions were also at the lowest rate ever at the start of 2022, with Netflix adding 18.2 million members last year – half the number who subscribed in 2020.
Netflix investors hoped they’d see an uptick in subscriptions, which sent the company’s share price down by almost 20%.
The company admitted competition from Disney+, Apple TV, Amazon Prime and HBO was having an impact and advertising was “an obvious route” to drive revenue growth, something Netflix has historically strictly shied away from”.