If you’ve been following Netflix lately, you know the streamer is on shaky ground at the moment. antenna Data shows that Netflix saw 3.6 million cancellations in the first quarter of 2022, over a million more than the company did in the first quarter of 2021 and the fourth quarter of 2021. This is a clear indicator that Netflix is about to lose its top spot in the streaming battle getting closer and closer.
While Netflix’s demise has prompted speculation as to whether the SVOD (subscription video-on-demand) industry has peaked and is beginning a downward trend, new antenna data shows otherwise.
Antenna noted that US subscriptions in the premium SVOD category grew +4.0% q/q and +24.7% yoy. The research also shows that there were 37.4 million gross new SVOD customers and a loss of 29.8 million subscribers, leaving only 7.7 million gross new subscribers in Q1 2022.
The figure of 37.4 is consistent with the last two quarters but is significantly higher than 2019 (pre-Covid-19). Growth was largely driven by fledgling services Peacock and Paramount+, which combined added 6.1 million or more U.S. subscribers.
For comparison, in 2019, when the market was dominated by Netflix and Hulu (services like Disney+, Peacock, and HBO Max weren’t there yet), there were 10.3 million total subscriptions in the first quarter of the year. The massive surge shows a three-year compound annual growth rate of 54%.
While subscriber growth may be high right now, so are cancellations. According to Antenna, there were nearly 30 million cancellations in the first quarter of 2022, up 12% from any quarter in history or 4.5 times the cancellation volume three years ago.
The cancellations may not be a cause for concern, as the addition of new subscribers suggests consumers are bouncing around — aka churn and return. Paramount+, Peacock, and Disney+ accounted for 51% of all new signups for the quarter. Also, those three services accounted for a large chunk of new signups for Netflix’s churned users in the first quarter of 2022.
Peter Fondulas, Director at Hub, specified, “Netflix’s subscriber loss in the first quarter of 2022 and expected losses in subsequent quarters represent a tiny portion of its global subscriber base. And indeed, at some point, a service as widespread as Netflix only has so much room to grow. In our view, it would be a grave mistake to take the Netflix experience as a sign that streaming TV services are on the verge of demise, as some analysts have suggested. The lure of hot exclusive content and the sheer convenience of on-demand viewing are two powerful forces that should keep these services growing, at least in the short term.”
In the first quarter of 2022, Netflix announced a Loss of 200,000 subscribers, and suffered its first loss of subscribers in more than a decade. The decline took Netflix’s subscriber base down to 221.6 million from 221.8 million in the previous quarter. Losses are only set to continue, according to Netflix forecasts, and the streamer is expected to lose 2 million in the second quarter.
Since Netflix has raised prices for all of its domestic plan tiers January 2022, there was a big spike in subscription cancellations. Netflix US monthly active churn rate was just over 2% January 2019after it increased subscription prices.
Continue, antenna Data shows that Netflix’s monthly active churn rate increased by +0.95 points mom in January 2022, where a price jump resulted in a 3% monthly active churn rate. At the end of March, Netflix’s monthly active churn rate was 3.3%. This suggests that Netflix is imminent cheaper ad-supported level is the company’s plan to minimize churn.
All of this data shows how volatile the streaming market is. It’s hard to predict which service will come out on top next, but established streamers like Netflix need to be on their toes and invent new strategies to attract new subscribers.
Premium streaming subscriptions continue to increase despite Netflix’s downfall – TechCrunch Source link Premium streaming subscriptions continue to increase despite Netflix’s downfall – TechCrunch