Julia Stoll
Research expert covering TV and video media
Subscription video-on-demand in the U.S. - statistics & facts
Popular with media consumers of all ages and generating billions of U.S. dollars in revenue in the United States alone, subscription video-on-demand (SVOD), an entertainment programming model where users pay a monthly fee in exchange for instant access to a streaming library, is certainly here to stay. However, the streaming industry is a fast-paced and changeable one that seemingly never sleeps. In the last few years, streaming services struggled to continue to grow in the saturated U.S. SVOD market, and some services even lost a substantial number of customers.
The entrance of Disney+ and Apple TV+ into the U.S. SVOD scene, as well as the succession of HBO Max and Discovery+ by the combined service Max, arguably disrupted the status quo. Disney+ quickly amassed a significant audience, almost doubling its global subscriber base between the beginning of 2021 and the end of 2022. However, also the House of Mouse struggled to retain their subscribers lately. Moreover, following a net loss of over one billion U.S. dollars in its direct-to-consumer segment in the first quarter of 2023, Disney slashed billions of U.S. dollars in costs, including both content and non-content cuts, in order to make its streaming business profitable.
Nowadays, consumers can choose from many new and existing ad-supported video-on-demand platforms, but also bundles and promotional offers. Subscription services like Netflix and Disney+ have recently launched their own lower-priced ad-supported tiers in order to reduce churn and increase their revenues. This trend suggests that the SVOD market in the U.S. could continue to grow, albeit driven by different monetization models and other special attempts.
The U.S. SVOD industry – a competitive environment
Netflix has long been the SVOD market leader both in the United States and worldwide, despite rising competition. The service now has tens of millions of subscribers in the U.S. However, the perception of the streaming giant has taken a hit in the last few years. While the share of subscribers who were satisfied with Netflix amounted to 90 percent in 2021, the satisfaction rate declined below the 80 percent mark. Moreover, a survey asking users about eight different streaming services revealed that Netflix saw the highest year-over-year drops in the share of subscribers who were likely to keep the platform between 2021 and 2023.The entrance of Disney+ and Apple TV+ into the U.S. SVOD scene, as well as the succession of HBO Max and Discovery+ by the combined service Max, arguably disrupted the status quo. Disney+ quickly amassed a significant audience, almost doubling its global subscriber base between the beginning of 2021 and the end of 2022. However, also the House of Mouse struggled to retain their subscribers lately. Moreover, following a net loss of over one billion U.S. dollars in its direct-to-consumer segment in the first quarter of 2023, Disney slashed billions of U.S. dollars in costs, including both content and non-content cuts, in order to make its streaming business profitable.
Cost becomes a key driver
While specific content, such as original and exclusive programming, had long been the most common reason for signing up for a certain platform, recent surveys showed that with more and more SVOD services raising their prices, a low subscription fee now plays an important role. It is therefore unsurprising that people are increasingly looking for other online video entertainment options, signing up for services to watch a specific piece of content, and sharing their passwords with people outside their households.Nowadays, consumers can choose from many new and existing ad-supported video-on-demand platforms, but also bundles and promotional offers. Subscription services like Netflix and Disney+ have recently launched their own lower-priced ad-supported tiers in order to reduce churn and increase their revenues. This trend suggests that the SVOD market in the U.S. could continue to grow, albeit driven by different monetization models and other special attempts.
