Omdia: SVOD services are declining and free video is on the rise

According to Omdia's analysis from November 2023, the number of subscription video-on-demand (SVOD) services per home has declined in several markets for the first time. Simultaneously, free video stacking is still on the rise. YouTube's continued growth as the top video service provider in key markets has been fundamental to the sector's lead over paid video content growth. This has been buoyed further by solid growth in other social video platforms and Free ad-supported television (FAST) services.

Unveiling new insights at Connected TV World Summit 2024 this week, Research Director in Omdia's Media and Entertainment practice Maria Rua Aguete commented: "The appetite for free content is ever-increasing, and the major streamers are clearly leaning into this as a strategy; by the end of 2024, all major SVOD services will have advertising tiers."

FAST services have continued their upward trajectory in the US, with key players Tubi and The Roku Channel entering the top 10 most used services monthly. In Europe, however, broadcasters remain strong, with traditional free TV and broadcaster video-on-demand (BVOD) services leading.

Over the last year, Omdia research found that the average number of free video services per video user in the UK increased from 5.1 to 6.2 and in the US from 6 to 7.5 services. In the UK, free-to-air content continues to lead, with BVOD services and social media platforms as the most popular services, with FAST coming in third.

The allure of social media platforms such as TikTok and Instagram Reels has reshaped how individuals consume video content. With engaging formats and vast user bases, social media services offer compelling alternatives to primary streaming services. Similarly, free TV options like ITVX, BBC Player, and Channel4 in the UK provide viewers access to high-quality content without the burden of subscription fees.

"The landscape of video streaming services continues to undergo a significant transformation. Our data has found that social media platforms, particularly Instagram Reels, and the rise of free TV options like ITVX, BBC Player, and Channel4, have led to changes in British consumer behavior. Whether these changes are happening in response to the cost of living increases, paid subscription fatigue, or other factors, it underscores consumers' evolving preferences who increasingly have more places to access video content," concludes Rua Aguete.