There’s no doubt that people’s attitudes toward video monetization have shifted over the years. A few years ago, people only chose to pay for a cable television subscription that offered them their favourite TV channels and would sometimes shell out a penny to watch content digitally. However, cable TV subscriptions have plummeted in the 2020s due to the rise of digital streaming platforms. Hub Entertainment Research tracks such video industry shifts in its annual study. They published their most recent one in June 2022. This study reveals a fascinating insight into the current Video on Demand landscape and how consumer attitudes are shifting. This guide will discuss each of the things discussed in this annual report.
Who Did the Monetization of Video Study Survey?
The Hub Entertainment Research study surveyed 1,610 TV consumers. These consumers also met the following conditions: Meta title: An Overview of Shifting Attitudes toward Video Monetization Models Meta description: Attitudes towards different video monetization models are shifting rapidly. Here is what consumers prefer in 2022.
- Were between the ages of 16 and 74
- Watched a minimum of one hour of television each week
- Had broadband cable at home
Factors That Have Impacted How Consumers Perceive Streaming Services Attitudes towards streaming services are markedly different in 2022 compared to 2021 due to the following reasons:
Higher Subscription Prices Not long ago, major streaming services such as Netflix, Amazon Prime Video, Hulu, and HBO Max were competing for customers by offering low prices. It wasn’t uncommon for most basic plans to cost less than $10 per month. However, these major streaming platforms have raised their prices significantly in the past year.
The monthly subscription fee for each major streaming service’s basic ad-free plan in 2021 was:
- Netflix: $8.99
- Hulu: $5.99
- HBO Max: $14.99
- Disney+= $6.99
- Amazon Prime Video: $8.99
The monthly subscription fee for each major streaming service’s basic ad-free plan in 2022 is:
- Netflix: $9.99
- Hulu: $14.99
- HBO Max: $14.99
- Disney+= $7.99
- Amazon Prime Video: $14.99
The recent global inflation rate spike has significantly reduced consumer spending power. The inflation rate for the United States in 2022 is currently 8.2%. This rate was 7% in 2021 and 1.4% in 2020. This reduction in spending power means consumers are feeling the pinch of the streaming service price hikes even more significantly.
Many streaming services are also getting rid of perks that caused consumers to sign up in the first place. One of the most prominent perks slowly being phased out or monetized is the ability to share accounts with family and friends. Netflix estimates that 30 million users across the United States and Canada engage in password sharing which has cost the company billions in potential revenue. It plans to start charging customers between $3.50 and $4.00 per month for “sub-accounts” that can share the main account’s password.
The Rollout of Ad-Supported Options
Many streaming services have begun rolling out ad-supported account options cheaper than their ad-free options. This rollout gives people with less money to spend the ability to subscribe to streaming services. However, this approach might not be very popular as many people are willing to pay for streaming services to avoid the ads associated with watching cable television. Adding ads to streaming services could discourage some consumers from shifting away from their current cable broadband subscription and signing up for a streaming service.
The Study’s Findings
The Hub Entertainment Research study’s findings were in the following areas:
The amount that consumers are paying for TV has been falling since 2020. Here is the amount they spent each year:
- 2020: $94
- 2021: $73
- 2022: $68
It might seem strange to see the amount consumers are paying falling. However, this could be explained by consumers shifting to cheaper ad-supported options. Alternatively, they may have cancelled their streaming service subscription in favour of sharing an account with a family member or friend.
The amount that consumers considered “reasonable” to spend on TV also fell between 2020 and 2022.
- 2020: $72
- 2021: $73
- 2022: $68
This decrease in spending that consumers consider “reasonable” could be explained by higher rent, fuel, and grocery prices and how they have reduced the amount of money consumers are willing to spend on TV entertainment.
How Each Streaming Service Perceived Value Compare
The study also examined what percentage of consumers felt their chosen streaming service offered “Excellent” value versus “Good” value. The results are listed as follows: As you can see, the perceived value that the top streaming services offer is nearly identical.
How Consumers Perceive Ad-Free and Ad-Supported Subscriptions
Consumer perceptions of Ad-free and Ad-supported subscriptions were also measured: The above stats show that many consumers are mixed regarding how they value ad-supported vs ad-free streaming service subscriptions.
Attitudes Toward Account-Sharing
The study also examined whether consumers would sign up and pay for a streaming service if it offered account-sharing options. It looked at attitudes across three age ranges.
Are You a “Lot” More Interested in Signing Up for a Streaming Service If It Offers Account Sharing?
- All Ages: 33%
- Ages 16 to 34: 45%
- Kids in High School: 43%
This shows that people below 35 are more interested in streaming services that offer account sharing options.
Are You a “Definitely” Willing to Pay Extra for a Streaming Service’s Account Sharing Option?
- All Ages: 20%
- Ages 16 to 34: 29%
- Kids in High School: 34%
These results indicate that people under 35 are more willing to pay extra for a streaming service’s account-sharing option than older consumers.
Why Choose Hooligan Development?
To succeed OTT providers must keep up with shifting consumer attitudes towards streaming services. If you require assistance with optimizing your digital offerings, please get in touch with Hooligan Development. We have helped many OTT providers in this area using our team of designers, developers, engineers and QAs. Contact us to take your OTT business to the next level.