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Antenna: Domestic 2023 SVOD Sub Growth Dropped 50%, While Churn Tripled
February 27, 2024
Growth of premium SVOD subscription tiers dropped more than 50% to 10.1% in 2023 from 21.6% growth in 2022, according to new data from Antenna. Last year saw 19.3 million more gross subscriber additions and 36.2 million more cancelations than in 2022, which translated to 17 million fewer net subscriber additions.
Antenna found that total SVOD subscriptions in the United States approached 243 million at the end of 2023. Peacock, Paramount+ (both up 1%), and Netflix drove the most of the sub growth, while Netflix held its market share (26%) for the first time since 2019.
With continued subscriber growth comes increased churn, or subs that don’t renew on a monthly basis. The data suggests that the churn rate has tripled over the past four years to 5.5%. Peacock saw the greatest improvement in churn and Starz saw the greatest increase. Netflix maintained it’s industry-low churn rate at just below 2%.
However, subscribers dropping service do come back to the same or similar SVOD platform — underscoring the consumer appeal of month-to-month access compared with long-term contracts, according to Antenna. Indeed, nearly a quarter of canceled accounts return to the service within three months, and more than 40% within 12 months. About 30% of SVOD gross sub additions in 2023 were returning subscribers, meaning these users had canceled service within the prior 12-month period.
Apple TV+ saw the highest instance of returning subs at 37.2%. The returning Netflix rate fell from 35.2% to 26%, driven by the password crackdown, which led to many first-time sign-ups by individuals who had previously used the service for free (password sharing) through another person’s account.
Peacock and Netflix saw the greatest number of returning subscribers, with 30% of cancelations resubscribing by within 90 days. After a year, 50% of Peacock and 46% of Netflix canceled subscribers had returned to the respective services.
About 39% of SVOD subscriptions are in their first year, with the percentage rising to 45% when excluding Netflix. More than 51% of the 95 million first-year SVOD subscribers are in the first 90 days of the service — the period of highest possible churn. The probability of canceling service drops from 9% in the first 12 months to 4% in the second year.