Ad-supported streaming subscriptions could add up to 1.8 million new subscribers in Sweden, according to Mediavision’s latest research. After surveying Swedish users, the company concluded that this would mean significant growth, but also that the companies' revenues would include advertising as well. The company had previously reported that almost 70% of the Swedish households have at least one SVOD service.
In many countries, it has become increasingly common to offer cheaper online video subscriptions that also include advertisements. In Sweden, there have only been a few such launches so far, where both advertising and consumer payments finance the service. However, there are many reasons to believe that this type of subscription will become more popular, as it enables lower consumer prices. For the industry, this could be a way towards further growth, if the low-priced plans lead to households acquiring more subscriptions.
“As the pure pay-streaming market matures, new initiatives for growth are needed,” comments Fredrik Liljeqvist, senior analyst at Mediavision. Advertising enables less expensive services for consumers but also new revenue streams for streaming services. This means households may consider acquiring more subscriptions, while advertisers in Sweden can reach many viewers with ads.
On many markets, cheaper streaming options, where households pay less because the subscription includes advertising, are already common. For example, in the U.S., Netflix has reported that the company's ad-supported tier now has 23 million active users per month. This is still a relatively new phenomenon in Sweden. Currently, over 200,000 households, or about 7 percent of streaming households, have opted for a cheaper ad-supported alternative. This can be compared to 3 million households that have a fully paid streaming service without ads. In the autumn 2023, ad-supported options were launched by Disney+ and TV4 Play. Discovery+ also offers such subscription.
Most signs point to an increased offering of ad-supported streaming services. Skyshowtime has communicated that an ad-supported subscription will be launched in April, in Sweden and other markets. Warner Bros. Discovery has also announced that the new streaming service Max will have such an option when it launches in Sweden this spring. Additionally, both Amazon and Netflix offer cheaper ad-supported options on several markets, but nothing has yet been communicated about a potential launch in the Nordics.
