The keys in the streaming battle

The consultant Simon-Kucher & Partners publishes a study that shows that the fight to gain market share in streaming continues while the industry seeks to improve its profitability with price increases. But with a considerable part of subscribers thinking about canceling their subscriptions, streaming platforms must know how to value their offer.

He Global Streaming Study 2023 It was carried out during the month of May 2023 by the global consulting firm Simon-Kucher. More than 12,000 consumers across 12 countries (Australia, Brazil, China, France, Germany, India, Netherlands, Singapore, Spain, Sweden, UK, US) were surveyed about their streaming behaviors and preferences.

Lisa Jaeger, partner and global leader of the Technology, Media and Telecommunications practice at Simon-Kucher, considers that “the work on behaviors and preferences of streaming users in 2023 in Spain reveals that platforms such as Netflix, Disney+ or Atresplayer Premium are well positioned in terms of the perceived value-price relationship.”

"In all 12 countries analyzed, subscribers perceive only small differences in the value of different platforms, making it more important than ever for streaming giants to stand out in a saturated market. Although consumers are preparing for additional price increases in the next 12 months, these price increases carry the risk of leading to an increase in cancellations. Even small price increases should be justified by improvements in value. Although this varies by region and age, the combination of streaming with video games or the inclusion “Social functionalities could increase the value of the offer for the consumer,” he adds.

The differences in perceived value between the big global streamers are small, but the study indicates that subscribers consider that Netflix and Disney+ offer more value than Amazon and Apple TV+. And although globally respondents perceive that industry leaders have prices that are consistent with the perceived value of their products, 20-40% of streaming users say they are considering canceling a subscription during the next 12 months.

Apple TV+ users worldwide are, by far, the most likely to consider cancellation, with 39% indicating they are likely to cancel their subscriptions in the next year. Netflix and Amazon have more loyal audiences, with ~20% of users considering cancellation in the next 12 months, while Disney+ sits at 24%. In Spain the situation changes slightly, it is Amazon, HBOmax and Disney+ that lead in terms of most loyal users, closely followed by Netflix and Atresplayer Premium.

This is due to perceived differences in the most important purchasing criteria:

Amazon is perceived as the platform with the cheapest price compared to the competition globally, followed by Atresplayer in Spain, while Apple TV+ as the most expensive in relation to the value offered. In the case of Spain, Movistar+ is perceived as even more expensive than Apple TV+ and with a similar value.
After price, the most relevant purchase criteria for Spanish subscribers are the wide selection of content, the absence of advertisements and the frequency of releases.
In Spain, Disney+ leads in terms of the wide selection of content, as well as exclusive content, due to its rights with Marvel or Star Wars for example. While Netflix leads in the frequency of release of new content

Previous vs. cancellations

In Spain, the majority of subscribers expect streaming prices to increase in the next 12 months, especially for Netflix and AppleTV+ (where 59% of their subscribers expect a price increase), but also for Disney+ and Amazon (48%). Although subscribers anticipate price increases, the price sensitivity is relatively high. For example, in the case of Netflix in Spain, where 22% are already considering canceling a subscription in the next 12 months, a 20% price increase would increase cancellation intention from the current 22% to 45%.

At a global level, the combination of streaming and gaming could be promising in the future, especially for those under 40 (51% are interested compared to 32% of respondents 40 and older). The combination is particularly attractive in India (75% of younger users are enthusiastic), China (65%) and Brazil (60%). Spain is among the countries with the best acceptance for the combination of gaming and streaming (with 40% of respondents interested).

a new social functionality allowing multiple accounts in different locations to sync and play content at the same time could also provide value. Globally, 42% of respondents would be interested, including India (69%), Brazil (62%) and China (60%). In Spain, this functionality arouses the interest of 45% of subscribers.