Australia’s streaming boom has continued into 2021, new analysis shows, with 80% of Australian households now subscribing to at least one paid streaming service.
In fact most have more than two, according to Deloitte’s annual media consumer survey.
The survey’s findings also strengthen doubts in the industry around the ceiling for paid subscriptions as the space becomes increasingly crowded, with 58% of respondents raising concerns about the costs of having multiple services.
The report found the average Australian household has 2.3 TV or movie streaming subscriptions, with younger people the heaviest consumers.
It revealed that 95% of Gen Z have at least one subscription service, followed closely by 93% of millennials, figures that have risen in the past 12 months.
Significantly, 60% of this combined cohort have more subscriptions than a year ago.
“While digital entertainment subscription services have been on a continued growth trajectory for some time, the Covid-19 lockdown effect cemented their place in our households,” the report says.
It also showed those with a subscription were paying an average of $55 per month.
Another report, Telsyte’s 2021 Australian Entertainment Subscription Study also reflected an uptick in Australian subscribers over the past year.
It found the average number of streaming subscriptions reached 3.1 million in June 2021, up from 2.8 million in June 2020.
Interestingly, its survey results suggested Australians have become more rather than less willing to shell out for multiple streaming services.
It’s survey showed 45% of respondents were open to subscribing to multiple services to meet their entertainment needs, up from 37% a year ago.
An ‘uncertain future’ for streaming
As streaming platforms flood the market, questions around the breaking points for consumers — and their wallets — continue to circulate.
In May 2020, Foxtel saw its subscriber base soar after it launched streaming service Binge; it saw a 933% increase in subscribers, growing from a base of 80,000 to 827,000 at the end of June this year.
At the same time its streaming service Kayo grew its subscribers from 465,000 to 1.079 million.
However the Telsyte study showed Nine-owned Stan remained the biggest Australian-owned player with 2.4 million subscribers.
Netflix has grown to 6 million subscriptions in Australia, with Amazon Prime Video jumping to 2.9 million, placing it just above Disney+ which has 2.6 million.
Michael Miller, head of News Corp in Australasia said in May it was “unsustainable” for the industry to expect households would continue to invest in subscription services.
“You could see some exits, you could see some closures. It’s an uncertain future,” Miller said.
But thus far even newcomers to the crowded streaming market have seen immediate uptake.
Leora Nevezie, national media sector leader at Deloitte said it was clear digital entertainment subscriptions, including streamed TV, movies and sport, music and gaming, had transformed from a “nice-to-have” to an essential service.
However, she agreed there was a limit to what households would pay.
“We are well and truly in the age of the entertainment subscription – but how many can we have before both the experience and our budget break?”
The Deloitte report also highlights the “convergence in the pay TV space”, as subscription streaming services are increasingly offered as as online extension of traditional subscriptions.
“Services like Foxtel Go and Foxtel Now serve as over-the-top streaming access to ‘traditional’ Foxtel services,” it says.
“We have also seen Netflix become readily available on Foxtel set-top boxes.”
The report suggests that, with 71% of pay TV audiences also holding a TV and movie streaming service subscription, and 25% also holding a sports streaming subscription, this convergence is a logical move for the industry.
“The combination of traditional pay TV and newer streaming services gives Foxtel a stronger entertainment ecosystem to attract new audiences and cross-sell once they are on board.”