New study puts number of video streaming subscribers at more than 2m in Australia
New research shows Australians are flocking to streaming services, such as Netflix, Stan and Presto, with two million streaming video on demand (SVOD) subscriptions thought to have been registered as of June 2015.
Telsyte has today put out new research which show the number of SVOD subscriptions surged six-fold in the last six months from 315,000 as December 2014 to 2m as of June 2015.
Fadaghi
The company says it believes that some 1.5m of these are paid subscriptions, as opposed to trials, with Telsyte managing director Foad Fadaghi noting that many of those subscribing were taking up multiple services.
SVOD = subscription video on demand (VOD), AVOD = advertising supported VOD and TVOD is transactional VOD (pay per item).
Fairly sensible look at the industry.
One of the main points the streaming companies need to take out of this is…
… “The market is being driven by a number of things – in part by the free trial periods – and when those things fall away we do think the retention and churn will be an issue”
As well as encouraging people to keep their subscription going rather than switching it on and off.
How is this achieved you may ask??? A foundation of data driven content marketing. If I have been watching action and sport themed shows don’t send me something about Sex In The City marathon. Sure way to get people to unsubscribe from your mailing list.
Here’s some of my comments from 23/06/2015. If you need any more insights into streaming let me know…
“The first who gets the right balance of acquisition and retention marketing right will win.
In addition to the above, if you look at overseas trends in this space people generally don’t just subscribe to one service. They subscribe to about 3 based on the content available and what service addresses their entertainment wants.”
Presto has a hard road ahead. Despite the monopoly Foxtel had, it peaked at circa 30% of TVH’s and has declined to the 27% mark, and will decline rapidly below that, especially as NBN rolls out. This low market penetration not only reflected the premium pricing for Foxtel and the anti syphoning list. There is another factor at play, which permanently diminishes Presto’s chances – the two parity preferred vote (typically 50-55% for the winning party and the balance, the losing). Just as no or very few Murdoch products enter most Green voter households (say 9-11% of TVH’s), some more rabid Labor voters of that party’s 30-40% of the electorate, might be similarly inclined. Once free from the monopoly that Foxtel held, prejudices can come into marketing play. Don’t think after Netflix, approached TEN during that company’;s strategy process, or that Stan are just going to remain one tier businesses.
Thus Presto starts at minus say 20-25% market share, and Stan and Netflix at zero start each. And that’s why they are way ahead already in total. I would hate to be the adjudicator at a Foxtel strategy meeting where Presto Man says to Foxtel man –“I want to promote this to Foxtel subs before Netflix grabs them”.
One wonders why Seven West Media joined such a structurally crippled business.
Hey Roger
One might also wonder why the FTA’s sat on their hands for so long before moving on SVOD. But then, you’ve probably got a copy of “Three Blind Mice” on your bookshelf.
The most effective content producers have aknowledged the inherant dangers geoblocking poses to their business model. Take the NBA for example. Purchasing NBA content is easy and varys little between geographical zone. As a result I purchased a full leauge pass . (and intend to renew). HBO on the other hand have their content locked up in deals with local content distributers. As a result I spend $4 a month on a VPN rather thsn paying foxtel. Sites like http://www.reviewmyvpn.com and http://www.bestvpn.con are making it easier (and cost effective) for the average viewer to evade geoblocks. The old guard of content producers need to lift if they want to be viable in the new world.
This disruption is going to continue for a long time. The film distributors are already moving into this space making Netflix, Stan etc unnecessary. Why would a distributor pay a fee to Netflix, Stan and presto when one can go direct to a VOD Warner Bros storefront? I thought Stan was going to be making $80m a year according to their reports, it seems PWC or KPMG were closer with a $15m turnover in 3 years. That must hurt those who invested. All the major networks should be ashamed, they are technically ill-equipped, they lack vision, they’re still living in the Packer era. I applaud ABC they have been the leaders in all this for years, not to mention the cinema chain Dendy, two companies have shown more originality and innovation than any mentioned in this article, but yet they’re not mentioned. Great to see Quickflix fighting on, I still remember all those DVD’s in the post, felt like christmas when they arrived. I just wish they would be on more devices and have a better experience maybe those funds they raised will bring just that. Freeview is also worth a mention, seems to be the biggest leader in this category for innovation and audience.
In preparing this study, Telsyte used:
• Interviews conducted with executives from SVOD providers, mobile operators, media companies and channel partners
• An online survey of a representative sample of Australians 16+ years of age conducted with 1,025 respondents in May 2015
• An online survey of a representative sample of Australians 16+ years of age conducted with 1,251 respondents in November 2014
• Financial reports released by service providers
• On-going monitoring of local and global market and vendor trends