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SVOD Subscriptions Fall with Password Sharing Crackdowns?

Streaming services like Netflix see declining subscriptions with the recent crackdowns on password sharing. By Ching Wai.

US - The recent crackdowns on password sharing have resulted in 23% of TV content viewers planning to cancel one or more subscription video on demand (SVOD) services in the coming months, reported a Horowitz Research titled “State of Media, Entertainment & Tech: Subscriptions 2024”. This is an increase from the 19% reported in 2023. Netflix is named the first streaming service for viewers to cancel subscriptions to.

52% of viewers have lost or cancelled access to at least one SVOD service in the past year. Reasons include the recent price hikes not matching their perceived value of the SVOD, and wanting to lower their overall subscription costs. Almost three in ten viewers who cancelled reported that not being able to share or borrow log-ins was a contributing factor to cancelling their subscriptions.

With the crackdown on password sharing, 35% of consumers reported paying more for subscriptions this year than last year. The average spend on SVODs has reportedly increased from 49.33 USD in 2021 to 60.60 USD in 2024. Six in ten viewers reported they welcome advertisements if it means paying less for subscriptions.

Adriana Waterston, executive VP of insights and strategy at Horowitz, observed, “The economics of the streaming business demand that these companies crack down on password sharing in order to deliver the great content audiences want. That said, given rising costs for streaming, consumers will become more and more judicious about how they are spending their money in the streaming ecosystem.”

Waterson further advised, “To avoid churn, subscription streaming services will need to focus on smart windowing strategies to keep audiences consistently engaged with their content and be proactive about helping consumers downgrade to lower-priced and/or ad-supported tiers as soon as they see a subscriber’s viewership and engagement dropping.”

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