Over three-quarters of Australian video customers plan to stop paying for pay-TV services within five years, a new study from Grabyo has found.
Grabyo’s ‘Video Monetization Trends 2020: The Consumer Strikes Back’ report used data from 13,000 consumers across 11 territories including the UK, France, Germany, Italy, Spain, US, Brazil, Argentina, Thailand, Japan and Australia.
The report asked consumers about their spending habits on TV and video services, how they value subscriptions, and future plans to pay for video.
As the streaming wars begin to take shape in 2020, the global penetration of online streaming has reached 55% of consumers, surpassing pay-TV adoption at 50%.
Of the global consumers who plan to stop paying for pay-TV, or have already cut the cord, 26% reported the number one reason was the price of services – Streaming is more affordable and more attractive.
The report found that 49% of Australian consumers spend up to A$20 per month on video services, while 40% of Australian video service customers report all of their video spend is on online streaming.
The growing popularity of streaming is also highlighted in the subscription to multiple services.
25% of Australian streaming customers pay for two or three online video services, compared to 26% in the UK, 32% across Europe and 35% in the US.
The report also highlights the amount customers are willing to pay for online streaming services.
46% state they are willing to pay up to A$29 per month for online video services.
Choice of what to watch, flexible subscription options and a low price point mean consumers are looking to spend smaller amounts on multiple services tailored to their interests.
This ceiling on monthly video spend indicates that consumers may be willing to subscribe to up to four or five online video services if the price is right.
“2020 will be the year we see the true impact of the streaming wars on video consumption habits and the continued impact of this has on the wider broadcast industry,” Senior Director and Head of APAC, Elliot Renton, said.
“Competition for spend and viewing time is only likely to increase, driven by rising investments in original content and local services in Australia have shown they are capable of competing with the major international players.
“Broadcasters, sports rights holders and media publishers will need to accelerate their plans to cater for consumers who want more flexibility by accessing video on digital and mobile platforms ”
The video industry has been preparing for the entrance of major players including Disney, Apple, NBC Universal and WarnerMedia (HBO).
The impact of these new services is reflected in consumer feedback in the report.
Netflix is dominant on a global basis, as it has reached 78% penetration in the Australian market, an 18% increase since Grabyo’s ‘Global Video Trends’ report in 2019.
Disney’s new streaming service, Disney+, has reached 17% already, while Amazon Prime has reached 13%.
Local online video services are rapidly growing in paid subscribers in Australia, with Stan boasting a 22% market penetration, while Foxtel Now has achieved 18%.
Grabyo’s new study also highlights how consumer habits in all demographics are beginning to align.
Since 2019, online video subscriptions in Australia have grown in every demographic.
Within the over 65 segment, there has been a 56% increase in online video subscriptions, alongside a 13% increase in the 50-64 age demographic.