US streaming subscriber growth was cut in half last year
February 27, 2024 – 6:48 AM PST
Streaming subscriber growth in the United States has halved in 2023, data from research firm Antenna showed, a sign that the boom might be over for the industry in its key market.
Growth in the premium subscription-video-on-demand category slowed to 10.1% last year from 21.6% in 2022. But its overall growth has more than doubled in four years, signaling a steady re-subscription trend.
At the start of the streaming boom, companies focused on pumping money into creating swathes of content to draw and retain subscribers. Customers also signed up to services during the pandemic while homebound with theaters being inaccessible.
But since then and with the twin Hollywood strikes last year, companies have been looking to keep content spend low while also pushing their ad-offerings to draw in revenue.
Streaming giant Netflix (NFLX.O), Comcast-owned (CMCSA.O) Peacock and Paramount Global’s (PARA.O), Paramount+ drove the most growth, with total subscriptions at 242.9 million at the end of 2023.
The report also indicated a shift in market share among streaming platforms. Netflix, which accounted for nearly half of the subscriptions in 2019, now represents just over a quarter of the market.
Paramount+ surpassed Disney+ in total subscriptions. Peacock and Paramount both saw a slight increase in their market share, while Discovery+, Disney+ and Hulu saw slight declines.
Antenna said streaming was entering a new phase of sobriety.
The previous stage was hyper-focused on acquisition to draw in a mass audience. But now that the largest players have that scale, they must shift their focus to managing their subscribers, it said.
About 30% of gross additions in 2023 were re-subscribes, referring to users who were previously subscribed to and had since canceled that same service within the prior 12 months. Nearly a quarter of the cancels were “won-back” within three months and more than 40% within 12 months, the report said.
Reporting by Jaspreet Singh in Bengaluru; Editing by Shilpi Majumdar
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What strategies can streaming platforms implement to effectively manage their existing subscribers and retain their customer base in the face of slowing growth
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Streaming Subscriber Growth Slows in the United States, Signaling a Shift in the Industry Streaming services have seen exponential growth over the past few years, revolutionizing the way we consume entertainment. However, recent data from research firm Antenna suggests that the boom might be slowing down in the industry’s key market, the United States. According to Antenna’s data, streaming subscriber growth in the United States has halved in 2023 compared to previous years. The premium subscription-video-on-demand category saw a growth rate of 10.1% last year, down from 21.6% in 2022. While this signifies a slowdown, it is important to note that overall growth has more than doubled in the past four years, indicating a steady re-subscription trend among consumers. In the early stages of the streaming boom, companies focused on investing heavily in content creation to attract and retain subscribers. This strategy proved successful, especially during the pandemic when people were homebound and theaters were inaccessible. However, with the twin strikes in Hollywood last year, companies have shifted their focus to keeping content spending low while leveraging their ad-offerings to generate revenue. Among the streaming platforms, Netflix, Comcast-owned Peacock, and Paramount Global’s Paramount+ have been the driving forces behind subscriber growth. Together, they accounted for a total of 242.9 million subscriptions at the end of 2023. Interestingly, there has also been a shift in market share among these platforms. In 2019, Netflix held nearly half of the market share, but now it represents just over a quarter. Paramount+ has surpassed Disney+ in total subscriptions, and both Peacock and Paramount have seen slight increases in their market share. On the other hand, Discovery+, Disney+, and Hulu have experienced slight declines. Antenna’s report highlights that the streaming industry is entering a new phase of sobriety. While the previous stage was focused on acquisition to draw in a mass audience, the focus now shifts to managing subscribers as the largest players have already achieved significant scale. This shift in focus is necessary to ensure the retention of existing subscribers while attracting new ones. Interestingly, the report also reveals that a significant portion of the new subscribers in 2023 were re-subscribes. These are users who had previously canceled their subscription but decided to sign up again within the prior 12 months. Approximately a quarter of the cancellations were won back within three months, and more than 40% returned within 12 months. The slowdown in streaming subscriber growth in the United States indicates that the market is maturing. As the industry continues to evolve, streaming platforms will need to find new ways to engage and retain subscribers. The focus on content creation and ad-offerings will remain crucial, but platforms will also need to prioritize managing their existing subscribers effectively. In conclusion, the streaming industry in the United States is experiencing a shift as subscriber growth slows down. This signifies a new phase of sobriety, where platforms must focus on managing their subscriber base rather than solely acquiring new customers. With streaming services becoming an integral part of our entertainment landscape, it will be interesting to see how the industry adapts to this changing landscape and continues to provide compelling content to its subscribers.
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