Stream TV Insider
Price hikes, password-sharing crackdowns, and a
cost of living crisis are deterring European subscribers from spending more on
subscription services – but not by as much as one might think.
article here here
Appetite for subscriptions remains
high, with 60% of British consumers saying they’d sign up to more subscriptions
if they could afford it, according to a new report from UK payment processing
company Bango.
Even a tax on streaming services
introduced in several European countries doesn’t seem to have deterred
consumers from subscribing, according to Bango. Its report is drawn from a
survey of 5,000 subscribers across UK, France, Spain, Germany, and Italy.
Although they spend less than
counterparts in the U.S. - €696 ($754) compared to €863 ($935) - one in five
European consumers are likely to add another subscription to their list soon in
order to watch the Paris Olympics.
The average European subscriber has
3.2 subscriptions, while the average American subscriber has 4.5. Note that in
Bango’s report ‘subscriptions’ includes SVOD alongside subs to other services,
from retail and gaming to food boxes.
Despite high cost of living concerns,
UK subscribers are now spending €68 ($74) per month on subscription apps and
services every year — on top of standard bills such as TV, phone, and internet.
One in eight are paying more than €117 ($127) a month for their subscriptions,
amounting to €1400 ($1,510) per year. That’s the highest in Europe, per the
report.
British consumers are also the most
likely to have a subscription which they always keep and never pause or cancel.
Almost two-thirds (60%) can’t afford all the subscriptions they want. Nearly
half (45%) have canceled due to recent price hikes, with 28% discouraged by the
introduction of ads.
Paul Larbey, CEO of Bango said, “The
UK consumer’s appetite for subscriptions now adds up to a material chunk of
monthly household spending. While there is a clear appetite for subscriptions,
affordability is a key concern.”
Across Europe, about 60% of consumers
also say they can’t afford all the subscriptions they would like. Yet over a
quarter (28%) said they don’t actually know how much they spend monthly on
subscriptions.
After services like Amazon Prime
Video, Disney+ and Netflix introduced cheaper advertising tiers nearly a third
(31%) of subscribers have downgraded while 28% have canceled altogether.
Nonetheless, about a quarter of
Europeans have actually upgraded their subscription and 76%believe paid
subscriptions should never display ads.
Tax on streaming
In 2020, France implemented a tax on
streaming services, often referred to as the ‘Netflix tax’ or
‘streaming tax’. This levy requires streaming platforms to contribute a
percentage of their revenue - potentially as high as 5.15% - generated in
France to the French National Cinema Center (CNC). Funds collected are used to
support French film and television productions, ensuring the continued growth
and promotion of local content.
Germany, Belgium and Italy have
passed similar legislation.
“It’s a lengthening list of
regulations designed to protect regional media and promote service transparency
in the face of the US streaming monopoly,” said Larbey. “While it’s been
reported as a controversial move in France, it hasn’t undermined the growth of
the subscription market in the region.”
Of respondents to Bango’s survey 31%
said they would object to the introduction of a France-style tax on streaming
services in their country.
And 94% of French subscribers have
continued to pay for their music subscription services since the introduction
of the 2024 music-streaming tax, which saw Spotify raise its
prices locally.
Market subscription
breakdowns
France
Subscribers in France pay an average
€65 ($70) for subscriptions per month. This is despite French subscribers
having the least number of subscriptions (3) compared to four other countries
in the survey.
Crackdowns on password sharing have
seen a third (33%) of subscribers now pay for a service they used to access for
free. French subscribers are apparently open to paying more for a service that
fits their needs, per this survey.
In fact, notes Bango, “they’d be
willing to pay the most of all European countries for an all-in-one content
hub.”
Spain
The average subscriber pays €60 ($65)
per month. For service providers, the introduction of advertising would appear
to be the least popular tactic when it comes to improving affordability, with
almost a third (31%) of subscribers canceling as a result. Of respondents in
Spain, 81% said paid subscriptions should never include ads – more than any
other nation in our survey.
Germany
With an average monthly spend lower
than that of its European neighbors, subscribers in Germany appear the least
likely to cancel following price hikes and the introduction of ads. That said,
over half (53%) say they can’t afford all the subscriptions they want, per the
survey. German subscribers are also the most likely to lose track of how much
they spend on subscriptions, with roughly 1 in 4 paying for a
subscription they’re not currently using.
Italy
Italians pay the least on average per
month for their subscriptions at €50 ($54). They are the most likely to cancel
a subscription following a price increase and the most likely to downgrade to
an ad-supported tier. Nearly 60% said they can’t afford all the subscriptions
they want, yet almost a third (30%) pay for a subscription they aren’t
currently using. Despite price sensitivity, Italian subscribers wouldn’t object
to a France-style streaming tax being introduced.
More work needed to
reduce subscription friction
“Even in the face of increasing
regulatory hurdles, the European subscription market remains a lucrative
opportunity for subscription services,” said Larbey.
But more can be done to reduce
friction, not least because most European subscribers (65%) feel there are too
many subscription services to deal with. Just under half (46%) are
“annoyed” they can’t manage all of their subscriptions in one place.
“Fed up with the complexity of
managing so many subscriptions, many subscribers just stick to one or two key
services,” commented Larbey. “Others have abandoned the market altogether and
turned to online piracy instead.”
To back that up Bango
highlighted a 2022 study by the EU’s Intellectual Property Office
revealing that the number of users across the continent accessing illegal
content declined between 2017 and 2021 then reversed when digital piracy
increased by 3.3% in 2022. The report blamed disjointed services and a lack of
legal, all-in one options for content.
Bango is using the report to argue
for telcos and other service providers to aggregate more subscription services
under their roof. That serves Bango’s interest because it provides a platform
for telcos to bundle subscriber payments, including help power Verizon’s
+play aggregation hub in the U.S.
To be fair, there does seem
widespread consumer appetite for change.
Half of Europeans in the survey said
they want the ability to pay multiple subscriptions via one monthly bill. Over
half (58%) want one app to manage all of their subscriptions and accounts. In
Spain, it’s as high as 67%.
“European subscribers have made it
clear that, just like in the US and Australia, they want telcos to offer these
all-in-one content hubs,” Larbey said. “And they’re willing to pay for it.
European telcos are already creating subscription-based deals but few combine
subscriptions outside SVOD. Mobile and broadband providers are primed to take
the next step into offering all-in-one content and subscription management
platforms, moving from bundling to what we call ‘Super Bundling’.”
No comments:
Post a Comment