More than a third (35%) of people with access to a subscription video on-demand (SVOD) service in the UK are sharing at least one of their subscriptions with others outside their home, according to Deloitte’s latest report, which also noted that subscription sharing has also become more formalized, with a quarter of users (25%) sharing the cost of an SVOD platform they use with other households. This is also most prolific among younger users, rising to 34% for 16-24 year-olds and 32% for 25-34 year-olds.
Among respondents who are currently using a service paid for by someone outside their household, the majority (57%) say that they would stop consuming the service if subscription sharing was banned. Only 15% say that they would take out a new subscription themselves if sharing was banned.
“Since the birth of subscription video on-demand, the sharing of user IDs and passwords with other households has been widespread. As SVOD providers look to implement tighter guidelines around sharing to boost subscriber numbers and revenues, consumers are being faced with the choice of paying more, moving to lower-cost ‘with-ads’ packages, or foregoing their access altogether,” said Paul Lee, Partner and Global Head of Technology, Media and Telecommunications Research at Deloitte.
“Restrictions on sharing may well lead to a growth in subscribers and higher revenues. However, it may also reduce the total number of people viewing a show or film, reducing the degree of buzz around that content, in turn diminishing the overall appeal of a service. Word of mouth recommendations – in person or online – have long been key to SVOD’s popularity. That said, some sharers who currently state that they would go without if subscription sharing was banned may ultimately decide to pay for access, so as not to miss out on the latest series of their favourite show,” Lee added.
● CHURN CONTINUES TO RISE WITH COST-OF-LIVING
Deloitte’s research also found that access to SVOD in the UK has fallen by one percentage point to 73% in 2023 in the last year, having peaked at 76% in 2021. The fall in access was steepest among 65-75 years olds (to 49% in 2023 from 53% in 2022 and 57% in 2021) whose usage of SVOD had surged during lockdown periods.
Meanwhile, the number of subscriptions per person is still rising, up from 2.46 in 2022 to 2.62 in 2023, an increase of 6.5%. However, this growth is at a much slower pace relative to 2018-2021, when the number of subscriptions per respondent rose 60%, from 1.45 to 2.33.
Deloitte’s research also revealed that one in five (21%) SVOD subscribers have cancelled a service in the past 12 months, up from 19% the previous year. The rising cost-of-living appears to have been a driver for this, with 27% of respondents saying they cancelled due to the subscription being too expensive (23% in 2022), and 24% cancelling due to rising costs elsewhere (21% in 2022).
“Churn is rising and continues to be a significant challenge for SVOD providers at a time when there is growing pressure for services to become profitable, mostly via the lever of increasing subscription prices. This comes at a time when consumers are continuing to be impacted by cost-of-living pressures,” Lee commented. “In order to reduce levels of churn, we may see more SVOD platforms teaming up with other media, telecoms, or financial providers to offer bundled deals; securing new and existing users in longer-term contracts. Meanwhile, a continued focus on producing a diverse range of high-quality content that is accessible for all consumers will be key,” he concluded.
The 2023 UK edition of “Digital Consumer Trends” is based on a nationally representative survey of 4.150 UK adults aged 16 to 75 between May and June. It is part of a global study involving 17 countries and 27.000 respondents.
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