Julia Stoll
Research expert covering TV and video media
Subscription video-on-demand market worldwide - statistics & facts
Subscription video-on-demand (SVOD) is in the throes of transformation. The sector is redefining business strategies, looking away from subscriber revenue towards advertising streams, and platforms are reaching out to each other for collaboration and bundling. Despite these changes, or more likely because of them, the SVOD remains the largest video streaming segment worldwide and it is forecast to grow further. However, the competition is fierce, and platforms are scrambling to retain and attract customers.
SVOD services are tirelessly adjusting to changing consumption demands and each one is trying to stay ahead in the game. However, this might mean that the streaming wars as we know them might be over. Reaching for ad-supported solutions and joining forces with the competition are some of the strategies explored to keep the customers interested and signed up. If these strategies play out as intended, the industry will witness the birth of cross-platform alliances.
Key players in the race for subscribers
The trend towards ad-funded streaming is particularly pronounced in SVOD’s largest market, the United States, in which over-the-top subscription revenue is forecast to surpass 64 billion U.S. dollars. The U.S. is also home to the world’s most popular streaming platforms. Netflix, Disney+, Amazon Prime Video – these names are undeniably associated with SVOD. The three combined boast more than 750 million subscribers across the globe, remaining significantly ahead of competitors Paramount+, Max (HBO), and Apple TV+. However, despite maintaining their status of the most popular SVOD services worldwide, Netflix and Disney+ in particular have struggled of late. Both were losing a substantial number of subscribers in a few markets as the competition among both long-standing providers and newcomers, such as Paramount+, has intensified over the last few years.Cost is key to customer retention
Video streaming consumption is changing. For years it was enticing customers with an ad-free experience, large content libraries, inexpensive subscription tariffs, and easy password sharing. Today, most of these benefits are limited to more costly plans and customers are looking for different solutions to traditional SVOD. Fully free and ad-supported services, subscription jumping, and bundles are popular ways to find desired content and offset higher expenses on streaming video. The industry is swiftly responding to the changing demands of its users and many more SVOD services are strategizing to offer bundles and ad-supported tiers. The latter approach, so-called hybrid streaming, designed to offset churn and revenues seems, to be paying off. In January 2023, for example, nearly one in five sign-ups to Netflix went to its “Basic with ads” tier, and forecasts suggest that the global number of ad-supported Netflix subscribers will continue to increase.SVOD services are tirelessly adjusting to changing consumption demands and each one is trying to stay ahead in the game. However, this might mean that the streaming wars as we know them might be over. Reaching for ad-supported solutions and joining forces with the competition are some of the strategies explored to keep the customers interested and signed up. If these strategies play out as intended, the industry will witness the birth of cross-platform alliances.
