The UK’s pandemic-fuelled streaming boom is officially over after households axed video subscriptions in record numbers to start 2022.
More than 1.5 million British households cancelled accounts for services such as Disney+, Now and Apple TV+ during the first three months of the year, new figures show, as the cost of living crisis continues to bite.
Families are looking for ways to curb non-essential spending to cope with rising energy, clothing and food prices, with more than half of the terminations attributed to ‘money saving’.
Numerous lockdowns had led to more people paying for streaming services including Netflix, Amazon Prime and Disney+.
But this bubble has now burst, according to figures from analytics group Kantar, as households ‘start to seriously prioritise where and how their disposable income is spent’.
The UK’s pandemic-fuelled streaming boom is officially over after households axed video subscriptions in record numbers to start 2022 (stock image)
Amazon Prime Video led the way for new subscribers in Britain, taking a 27 per cent slice of the market, while Disney+ was second with 14 per cent and Now third on 9 per cent, just edging out Netflix and Apple TV+
|Service||Share of new subscribers (%)|
|Amazon Prime Video||21.7%|
While 58 per cent of households still retain at least one paid-for streaming service, the number that do so fell by 215,000 in the first quarter of this year.
‘With many streaming services having witnessed significant revenue growth during the height of Covid, this moment will be sobering,’ said Dominic Sunnebo, the global insight director at Kantar Worldpanel, the publisher of the Entertainment on Demand report.
‘The evidence from these findings suggests that British households are now proactively looking for ways to save, and the subscription video-on-demand (SVoD) market is already seeing the effects of this.’
The Kantar Worldpanel report found that 16.9 million UK households had at least one subscription service at the end of the first quarter.
While there were 1.29 million new subscriptions to SVoD services in the UK in the first three months, this was outweighed by 1.51 million cancellations.
Unsurprisingly, the world’s two most popular streaming platforms proved to have the lowest rate of customers leaving in the first quarter, with cost-conscious subscribers identifying Netflix and Amazon’s Prime Video as their ‘must-have’ services.
Kantar said that despite ‘churn’ rates – the rate at which customers cancelled subscriptions – increasing almost across all streaming platforms, there was a ‘clear difference’ in the number of subscriptions cancelled outside of Netflix and Amazon.
‘Netflix and Amazon can be seen to be hygiene subscriptions for Brits; the last to go when households are forced to prioritise spend,’ Kantar said.
‘Disney, Now TV, Discovery+ and BritBox all saw significant jumps in churn rates quarter-on-quarter.’
Prime Video’s thriller series, Reacher, and Netflix dramas Ozark and Inventing Anna proved to be the most popular shows on SVoD services in the UK in the first three months of 2022.
While there were 1.29 million new subscriptions to SVoD services in the UK in the first three months, this was outweighed by 1.51 million cancellations
Kantar’s research, which was based on interviews with 14,500 people, found that cancellations of streaming subscriptions accelerated from 1.2 million a year ago and from 1.04 million during the final three months of 2021 to 1.5 million.
The first quarter of 2022 also saw the lowest ever rate of new subscribers, according to Kantar.
Amazon Prime Video led the way for new subscribers in Britain, taking a 27 per cent slice of the market, while Disney+ was second with 14 per cent and Now third on 9 per cent, just edging out Netflix and Apple TV+.
In January, Netflix said it added 18.2 million members last year — roughly half the number who subscribed in 2020 and the fewest since 2015.
The company also forecast that it would add just 2.5 million new subscribers globally in the first quarter, its worst start to a year in over a decade.
This stall in growth has disappointed investors, with shares in the streaming giant plummeting 43 per cent so far this year.
THE HISTORY OF NETFLIX PRICE HIKES IN THE UK
May 2014: Netflix announced an increase in its monthly fee for streaming movies and television shows from £5.99 to £6.99.
The price hike was immediate for new subscribers but was delayed for two years for its existing members.
But Netflix allowed subscribers to keep paying £5.99 a month if they opt for a lower-resolution ‘SD’ quality service.
May 2016: Netflix raises its monthly price for UK basic users from £5.99 to £7.49 a month.
A similar price change took place for US customers, who saw their subscription fee increase by $2 (around £1.40 at the time).
Anyone who signed up to Netflix when it launched in Britain would have received the standard package for £5.99 per month.
But in an email to subscribers Netflix wrote: ‘When we raised prices for new Netflix members in 2014, we kept your price the same for two years. Your special pricing is now ending and your new price will be £7.49 per month.’
October 2017: The company raised prices in both the UK and US for the first time in two years.
The standard package price increase by 50p to £7.99 per month.
The premium package jumped to £9.99 a month, an increase of £1.
Netflix said at the time that the price change reflected the additional content added to its service.
May 2019: Netflix confirms that British customers will see the price of the standard tarriff increase from £7.99 to £8.99.
The premium tarriff was also bumped up by £2 to £11.99.
January 2021: Netflix hikes subscription fees for UK users as the country entered its third lockdown amid the coronavirus pandemic.
The standard package – which allows two screens to access an account, as well as HD – was raised by £1 per month, from £8.99 to £9.99.
The premium package – providing four-screen access per account and Ultra HD – is bumped up by £2, from £11.99 to £13.99.
The basic package stayed the same price.
March 2022: Netflix increases prices for the second time in just over a year.
The basic and standard plan go up by £1 a month to £6.99 and £10.99 respectively, while the premium tier goes from £13.99 to £15.99.
Despite releasing hit shows last year, including Squid Game and a new season of Sex Education, Netflix added 18.2 million members last year — roughly half the number who subscribed in 2020 and the fewest since 2015
Higher charges for on-demand video services has also led people to reconsider their subscriptions.
Several providers have raised prices in markets including the UK, in part to compensate for rising costs of labour and facilities that have made TV and film production more expensive.
Netflix is among several providers that have raised prices, in part because of the increased costs of labour and facilities that have made television and film production more expensive.
There is also more choice than ever before, with Peacock from Sky – which features content from NBCUniversal – just one of the recently-launched services now competing with Netflix, Amazon Prime, Disney+, AppleTV+, Now and more.
WHAT ARE THE VIDEO STREAMING OPTIONS AVAILABLE TO UK CUSTOMERS?
Price: From £6.99 a month
Price: £7.99 per month OR £79 per year
- Tom Clancy’s Jack Ryan
- The Boys
Price: £4.99 a month
- Ted Lasso
- For All Mankind
Price: £7.99 a month OR £79.90 a year
- The Mandalorian
- The Simpsons
Price: From £9.99 a month
- Game of Thrones
Price: £4.99 a month
- Keeping up with the Kardashians
- Made in Chelsea
Price: £5.99 a month
- Spitting Image
- Midsomer Murders
Prices correct as of April 2022