Subscribers to Streaming giant Netflix have dropped for the first time since its launch in Australia in 2015.
Technology analyst firm Telsyte found that the number of users subscribed to Netflix dropped by 3 per cent for the year ending 30 June 2023.
Despite the dip, the study found Netflix (6.1 million) remained the top SVOD service at the end of June 23, followed by Amazon Prime Video (4.5 million), Disney+ (3.1 million), Stan (2.6 million), Binge (1.5 million), Paramount+ (1.5 million), Kayo Sports (1.4 million) and Apple TV+ (1.0 million).
The news comes as the Australian subscription market – which includes video, music and gaming services – saw a slowdown in annual growth in the past 12 months due to the rising cost of living pressures.
The Telsyte Australian Subscription Entertainment Study 2023 found that the total number of subscription services in Australia increased by 3 per cent to 49.9 million in June 2023. This growth rate is lower than the double-digit increase observed in the previous year.
The report also found that entertainment subscription services remain essential to Australians, with half of them saying that on-demand services are vital to meeting their entertainment needs.
The average total weekly video entertainment consumption fell by 9 per cent year-on-year to 45 hours from its high in 2022. SVOD was, however, one of the only two categories that saw an increase across 9 video categories measured by Telsyte.
Just under half (48 per cent) of subscribers claim they are more likely to switch between different services to save money, and only 27 per cent find it difficult to ‘unsubscribe’.
“Profits, partnerships, and more aggressive behaviour. There’s going to be increasing competition to win people over from other platforms,” Telsyte managing director, Foad Fadaghi, says.
Telsyte estimates the total number of SVOD subscriptions could reach over 30 million by June 2027, pushed up by “a new content boom; growth in multiple subscriptions; new market entrants and more ad-supported plans across services”.
SVOD market revenue is pegged at $2.7 billion for FY2023, a 14 per cent year-on-year increase driven by subscription cost rises and an increase in service adoption.
Free Services Remain Popular
The research found more than 60 per cent of non-SVOD users believe there is enough good quality video content from free sources to keep them entertained.
Broadcasting Video on Demand services (BVOD, including 7Plus, 9Now, 10Play, ABC iView and SBS On Demand) rhad more than 10 million viewers during FY2023.
Nearly 5 million Australians claim they have used free and ad-supported streaming TV (FAST) services, or services that offer FAST channels in the last 12 months.
