New study puts number of video streaming subscribers at more than 2m in Australia

netflix_australia-234x107New 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.



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.

“Our research shows it will not be a winner take all market, rather people will use multiple services – that was one of our key findings,” Fadaghi told Mumbrella.  

The new research comes a fortnight after polling company Roy Morgan published a survey which put the number of Australians accessing global giant Netflix at over one million.

Roy Morgan’s findings drew criticism from rival SVOD players, such as Quickflix, who claimed their numbers were being seriously underestimated.

Roy Morgan's recent SVOD survey

Figures from Roy Morgan’s recent SVOD survey

Fadaghi noted the report arguing there were flaws in some of the findings: “The way (Roy Morgan) measured it was not the way the industry measures it.

“The way you have to do it is to go speak to the individual providers and get their numbers / provided guidance, we spoke with Netflix, Stan, Quickflix we also conversations with Telstra all the time etc.

“We try to get an aggregate of what they have done.”

Telsyte has declined to give breakdowns of the individual services noting that it has signed non-disclosure agreements with some of the players, but noted the SVOD market was broader than the much hyped contest between Netflix, Presto and Stan, with a “long tail” of niche SVOD providers, including major sporting codes such as AFL, NBA basketball, NRL and UFC.

“The market is moving really quickly so it is growing very rapidly and so even from month to month we are seeing a massive amount of growth in the market,” said Fadaghi.

“The number we put together was some two millions subscribers at the end of last month and of that that 1.5m are paying subscribers who are actually being billed every month.

“It also includes a lot of the long tail providers the likes of HBO Go, which people access via VPN to get around the geoblock, it includes the likes of the NBA, AFL is quite big and does well.”

The company projects that the field of SVOD players could actually become more crowded as other content players seek to capitalise on the consumer interest in streaming.

“We think it is a heterogeneous environment in many ways and we think it will be fragmented. We think people will subscribe to multiple services depending on their needs.

“And there will probably be more services driven by this early success,” he said.

Fadaghi also warned that among the 1.5m paid subscriptions, many of them would be “on again, off again” arrangements, where consumers dive in and dive out depending on the available content.

“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,” he said.

“A lot of these providers will lose a lot subscribers and also there is a lot of seasonality in this area – many people subscribe for a service to watch a season of a particular program, then they might turn it off for a while and restart it when the next season comes on.

“It is very similar when it comes to sport for example NBA is now finished and so now people will unsubscribe and then resubscribe when the season returns.”

In terms of where overall household penetration was up to Telsyte said this was hard to estimate given it was unclear how many services consumers had, but projected that it be above 3.5m homes within a few years.

“We project around 40 per cent of Australian households will be willing to pay for this content while the rest of the market prefers to get their content ad supported or freely.

“We think that of the nine million households in Australia that’s a market of 3.6m households having at least one service in the next few years.”

Nic Christensen 


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