4 AUG 2023

Both new sign-ups and cancellations rise in the Australian streaming market

According to Kantar Worldpanel’s latest report, 1.62 million new VOD subscriptions were taken out between April and June 2023 in Australia, an increase of 280.000 on the previous quarter.

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VOD-enabled households that have access to at least one video streaming service in Australia increased to 6.24 million, up 114.000 quarter-on-quarter, representing 62.6% of households, according to Kantar Worldpanel’s latest “Entertainment on Demand (EoD)” data.

According to the study, 1.62 million new VOD subscriptions were taken out between April and June 2023, an increase of 280.000 on the previous three-month period. Furthermore, 5% of new VOD services were advertising-based video on-demand (AVOD) this quarter, up from 3% in Q1 2023, as consumers look to lower-priced plans to find value, alongside an increase in those taking advantage of free trials.

Regarding platforms, Apple TV+, Paramount+, Stan and Britbox all enjoy quarter-on-quarter increases in share of new subscriptions. On the other hand, Netflix endured the most significant net loss in users across Q2 2023 after introducing password-sharing restrictions and additional account member fees to Australia in late May.

Although Netflix’s Net Promoter Score (NPS) rating remains relatively high at 28 percentage points, it dropped from 32 percentage points in the last quarter. This drop in satisfaction is attributed to several factors, including the limitation on multiple users accessing the service, due to the introduction of a password-sharing ban. Net satisfaction declined from 12% to 6%, now below the category average. Additionally, satisfaction with value for money, whilst in line with the market, has also slipped quarter-on-quarter, despite an increase in subscribers on the low-cost Basic with Ads plan.

Moreover, Netflix’s churn rate has doubled to 6%, with planned cancellations in the next three months also increasing to 8%. For those cancelling Netflix subscriptions, 42% cited a desire to save money. Additionally, 30% cancelled due to the new password-sharing restrictions and an unwillingness to pay for additional members outside the household. It remains to be seen whether those lost users will eventually return and pay for the extra household member access or if they will continue not to see value in Netflix’s new sharing fees, Kantar Worldpanel noted.

Between April and June, 2023 there were 1.25 million cancellations of VOD services, up 100.000 on the previous three-month period, as consumers increasingly switch in and out of services. Cost-cutting was once again the underlying factor pushing most to cancel in an economic climate that remains tough for many.

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