In the third quarter of 2021, the proportion of US households who have a video subscription has dropped to 85% (down 1 percentage point quarter on quarter, and up 2 percentage points year on year), meaning there are now 109 million households with subscriptions, as of September 2021, according to Kantar’s latest report.
While SVOD remains the bulk of the streaming market, at 82% of US households, penetration declines by 1.5 percentage points quarter on quarter. However, FAST (free Ad-Supported TV) and AVOD (paid Ad-Supported Video on Demand) are growing tiers within the video streaming market: 14% access FAST services (up 3 percentage points quarter-on-quarter) and 21% access AVOD (up 0.8 percentage points quarter on quarter).
Overall, 4.5 million consumers cancelled subscriptions in the third quarter of 2021 (including those who had multiple subscriptions and remain in the streaming category). But of those who cancelled, 85% - or 3.8 million - were among consumers who had only one subscription in Q2 2021 (and now have none).
Across platforms, Amazon Prime Video accounted for the bulk of penetration declines, losing 2 percentage points in terms of penetration in one quarter. This comes after Amazon Prime Video accounted for the largest share of new subscription in Q2 2021, driven by Prime Day. Among the group who had one subscription in Q2 2021 and cancelled in Q3 2021, 69% had an Amazon Prime Video subscription.
Beyond SVOD, AVOD, and FAST streaming, Kantar’s report saw wins for live pay TV (cable TV or MVPD+) in Q3. Households with live pay only (no streaming) were up to 10% in Q3 2021 (compared to 9% Q2 2021), driven by cable TV. Similarly, households with both live pay TV and streaming were up to 51% in Q3, from 50% in Q2. Meanwhile, those with streaming only (AVOD, SVOD or FAST) were down 2.2 percentage points.
“As the bulk of streaming penetration declines in Q3 came from 'lighter' subscribers, in Q4 2021 we can expect to see fewer losses as the category is left with more engaged streamers. In an already crowded market, pressure mounts as cable TV is winning among the pool of potential streaming subscribers and users,” the report noted.
● STACKED SUBSCRIPTIONS GROW
Despite the decline in overall streaming, stacking continues to grow among those still in the market. Across total streaming, the average subscriber now has 4.2 streaming subscriptions, up from 3.8 in Q2 2021. The more mature platforms like Netflix, Amazon Prime Video, and Hulu continue to hold subscribers who are less likely to stack subscriptions, and stacking growth among these consumers is slower than the total market. "For newer competitors launching into video streaming, competing with the mature platforms may be more of a challenge than competing with other maturing platforms," the report says.
As Kantar noted in previous quarters, it is newer platforms that drive high stacking. Platforms like Apple TV+ (5.3 average subs), HBO Max (5.2), Peacock (5.3), Discovery+ (5.6), and Paramount+ (5.8) all have high stacking subscribers, the latter two being newer services that launched in Q1 2021. "For high stacking subscribers, this means more competition for screen time, and greater risk of churn," according to the report.