The launch of ad-funded tiers has driven more than a third of U.S. subscribers, 36%, to upgrade their services, according to the report “Subscription Wars 2024” by Bango. The study, which incorporates research from over 5,000 U.S. subscribers on their habits, behaviors, and attitudes toward subscriptions, revealed that ads are delivering serious gains for streaming and subscription giants. However, Bango explains that it is a dangerous game for subscription providers, with 31% of subscribers saying they have canceled at least one service because ads were introduced. Strong objections also remain towards premium ad tiers, with 78% saying that paid-for subscriptions should never display ads.
According to the Bango data, acceptance of advertising varies across different subscription types. While 35% of TV and video streamers have paid for an upgrade to avoid watching ads, this figure rises to 48% among music subscribers. For those streaming sports content (SportsVOD), the number is even higher, with a massive 71% opting to upgrade when ads are introduced into their services.
Commenting on these findings, Paul Larbey, CEO of Bango, said, “American attitudes towards subscriptions are changing. While many people predicted that ad-tiering would be firmly rejected, in reality, subscribers are welcoming the flexibility it provides. People want choice. Those who are happy to watch ads accept them, and those who aren’t pay a little extra. The important thing is that they have the freedom to choose.”
“It’s that same demand for choice that’s driving the move towards content hubs and Super Bundling. Subscribers want to jump between different content and services, but they don’t want the administrative headache of managing multiple accounts and paying multiple bills. With the rise of Super Bundling in 2024, we’re expecting to see that headache disappear. At the same time, these all-in-one platforms will help drive new revenue for cell phone providers and allow subscription services to share users rather than fighting over them. It’s a win-win scenario for businesses and subscribers alike,” added Larbey.
The Bango report also highlights the impact of recent crackdowns on password sharing. Since services like Netflix introduced the new, strict rules, 35% of subscribers have started paying for a service they previously accessed for free via someone else’s account. While these changes drive subscribers to sign up and payout, they’re apparently not enough to keep some people hooked. More than a third of subscribers (35%) still regularly jump between platforms, pausing and restarting their subscriptions to access the content they want. According to Bango’s analysis, this demand for flexibility and cross-platform experiences isn’t going away.
2023 saw services like Verizon +play launch as America’s first all-in-one subscription hub, “Super Bundling” services such as Netflix, Starz, Max, Paramount+, and more all in one place. According to Bango, this represents a welcome trend for subscribers, with 73% saying they want one platform to manage all of their subscriptions in one place. 69% would also like the ability to pay for multiple subscriptions via one monthly bill. When offering these all-in-one services, American subscribers are wary of a return to cable TV-style packages, with only 29% wanting their cable company to manage their subscriptions. Instead, 50% of subscribers say they want their cell phone provider to launch a content hub. Most of these (61%) would even pay a higher cell phone bill to receive this service, with the average subscriber happy to pay an additional $364 per year (+19% of their annual bill).