The clash continues for streaming market share – with consumers considering cancelling subscriptions and potential price increases threatening churn rates, the key players must prove their value

Simon-Kucher’s recent Global Streaming Study reveals that Australian streamers perceive relevant differences in overall platform performance, and that there is appetite for new offerings

• ~15-40 percent (dependent on provider) of Australian subscribers are considering cancelling streaming subscriptions within the next year, even before considering price increases
• Around 45 percent of subscribers would consider cancelling if prices increased by 20 percent
• Most subscribers expect streaming prices to rise next year, particularly for Disney+ (68 percent expect a price increase)
• Amongst key players in Australia, Apple TV+, Foxtel Now and Stan stand out for being streaming services outside of the ‘consistency corridor’ when measuring perceived value and price

[Sydney, October 3, 2023] -- The latest research from global consultancy Simon-Kucher into consumer streaming behaviour and preferences reveals that subscribers perceive Netflix, Amazon, Disney+, Binge and Paramount+ to have a price that is consistent with perceived product value, signalling little to no room for straightforward price increases. Other players like Stan, Foxtel Now and Apple TV+ are even considered to be outside the ‘consistency corridor’, meaning that their price exceeds the relative value they provide. Increasing prices without also enhancing the perceived product value could be costly for streaming services, leading to risks of cancellations in a competitive market.

“With subscribers being increasingly price-sensitive, it’s more important than ever for streaming services to stand out in saturated market,” said Lisa Jaeger, Partner and Global Head of Technology, Media & Telco at Simon-Kucher. “Even though consumers are bracing for additional rises in costs of subscriptions in the next year, price increases pose a threat of losing droves of subscribers– even smaller increases should be justified with value enhancements.”

Value perception – a key factor in the struggle for streaming market share

Even though Australian respondents feel that most industry leaders have prices that are consistent with perceived product value, ~15-40 percent say they are considering cancelling their subscriptions within the next year. While the study indicates that subscribers perceive Netflix, Disney+, and Amazon Prime Video to deliver a relatively similar value, players such as Apple TV+, Foxtel Now and Stan are considered to offer less compared to the streaming giants.

Apple TV+, Paramount+ and Stan users are by far the most likely to consider leaving, with more than 30 percent indicating that they are likely to cancel their subscriptions within the next year. Disney+ and Amazon fare better, with ~20 percent of users considering cancelling within the next year, while Netflix sits at 14 percent. These are driven by perceived differences on the most important purchase criteria:

• For Australian respondents, Amazon is perceived to have the cheapest price compared to competition; Foxtel Now and Apple TV+ are perceived as most expensive for what they offer
• Netflix is perceived as market leader in terms of broadness and frequency of new content added to the platform
• Disney+ ais perceived to have the most unique content, likely due to its exclusive film rights (e.g., Marvel, Star Wars)
• Netflix is perceived to be the most intuitive platform to use while Apple TV+ is considered to have the lowest ease of use

Potential price increases threaten to drive churn rates

Most subscribers expect streaming prices to rise in the next year, particularly for Disney+ (68 percent expect a price increase) but also for Binge (67percent), Netflix (67 percent), Amazon and Apple TV+ (66 and 65 percent respectively).

Even though price increases are anticipated, price sensitivity is relatively high with roughly 45 percent of subscribers stating that they would consider cancelling if prices increased by 20 percent.

Complete study findings are available upon request, including country splits.

*About the Study: The Global Streaming Study 2023 was conducted during May 2023 by the global consultancy Simon-Kucher & Partners. More than 12,000 consumers from across 12 countries (Australia, Brazil, China, France, Germany, India, Netherlands, Singapore, Spain, Sweden, UK, US) were surveyed on their streaming behaviours and preferences.

For further information, please contact: 

Maximilian Stengl 
Email: maximilian.stengl@simon-kucher.com 

About Simon-Kucher

Simon-Kucher is a global consultancy with more than 2,000 employees in 30 countries. Our sole focus is on unlocking better growth that drives measurable revenue and profit for our clients. We achieve this by optimizing every lever of their commercial strategy – product, price, innovation, marketing, and sales – based on deep insights into what customers want and value. With 37 years of experience in monetization topics of all kinds, we are regarded as the world’s leading pricing and growth specialist.

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