British households have cancelled their streaming subscriptions in record numbers so far this year as families continue to grapple with the rising cost of living.
A little more than 1.5 million video on-demand accounts were scrapped in the first three months of 2022, according to figures from market research firm Kantar, leaving platforms such as Disney+, Apple TV+ and Now concerned.
Netflix and Amazon Prime, on the other hand, were found to be “the last to go when households are forced to prioritise spend”.
More than half a million cancellations were attributed to “money saving”, with households budgeting for higher prices and energy bills instead, Kantar said. Young adults in particular have become wary of paying for television on top of the £159 annual licence fee, the researchers found.
At the height of Covid – especially during lockdown – subscriptions for these kinds of platforms surged.
However, researchers said the proportion of consumers planning to cancel subscriptions stating the primary reason as “wanting to save money” had risen to its highest ever level at 38 per cent, up from 29 per cent in last three months of 2021.
While this does not mean houses have purged themselves completely of streaming subscription – with 58 per cent said to retain at least one streaming service – the terminations suggest viewers have become more apprehensive about subscribing to multiple platforms.
Kantar said households were “starting to seriously prioritise where and how their disposable income is spent”.
Dominic Sunnebo, the global insight director at Kantar, added that the latest research would be “sobering” for the industry. “The evidence from these findings suggests that British households are now proactively looking for ways to save,” he said.
It comes amid surging energy, clothing and food prices in the UK, which pushed inflation to a 30-year high in March, data from the Office for National Statistics (ONS) showed last week.
Kantar assessed various platforms’ churn rates – meaning how many users they lost on a gross basis – which found that Britbox, Apple TV+ and Discovery+ suffered the worst with people coming and going.
Researchers said Amazon Prime’s thriller series Reacher was the most-watched title in the first quarter of the year, followed by Ozark and Inventing Anna on Netflix.
They added that although churn rates increased almost across all streaming platforms, there was a “clear difference” in the number of cancellations seen outside of Netflix and Amazon – going as far as calling both “hygiene subscriptions for Brits: the last to go when households are forced to prioritise spend”.
Many consumers are still signing up for streaming services, too. Kantar’s research, which was based on interviews with 14,500 people, found that around 3 per cent of British households took out a subscription during January, February and March of this year.
But this was a marked deterioration from the 4.2 per cent that did so at the same time in 2021.
Media investors have reportedly become concerned that the rapid growth of video streaming – encouraged by demand during the pandemic – has peaked.
Shares in Netflix, which is due to release its first-quarter earnings on Tuesday, have dropped 43 per cent so far this year as global subscriber numbers disappointed.
The company admitted earlier this year that rival platforms were starting to have an impact, saying the competition “may be affecting our marginal growth some”.
