Streaming industry in Australia and current market dynamics

| min read
apac streaming study

Customers in Australia are struggling with subscription fatigue. They are more price-sensitive: consumers are cutting down their subscriptions and streaming more free content online. We asked experts Maximilian Stengl and Christoph Petzoldt to share their insights on the streaming industry in Australia and the opportunities for streaming service providers.

Compared to 2022, the global average of viewers streaming more hours dropped by nine percent in 2023. How is the streaming industry in Australia faring so far?

We’re finding that global trends are being reflected in the Australian context in our most recent study. The findings show that only 36 percent of respondents within Australia are engaged in increased streaming compared to the previous year, representing a notable decline of 13 percentage points. This data points toward a deceleration in the pace of streaming expansion and a reduction in the willingness to pay.

What does the consumer streaming behavior indicate for the streaming industry in Australia

We’re seeing a slowdown in the current market dynamics and have found several factors in our research to support this. In analyzing the data, we've found a notable 10 percent reduction in the average number of owned subscriptions per respondent. This is accompanied by a substantial 25 percent downturn in the willingness to allocate funds for each subscription. Additionally, there's been an eight percent increase in the time spent on free online streaming, signifying a heightened sensitivity to pricing among consumers.

Taken together, these findings confirm the market slowdown. As a result, we’ve seen streaming providers proactively alter their monetization methods and packaging plans to secure future opportunities for growth.

What are the biggest drivers for viewers when choosing a streaming service provider?

Unsurprisingly, price remains the predominant factor influencing purchasing decisions, followed by an extensive array of available content. However, in an interesting departure from the global norm where there has been a four percent decline, the Australian audience prioritizes frequency of new content, resulting in a two percent increase.

This notable shift has propelled the frequency of new content to be the fourth most influential purchase criterion in the streaming industry in Australia. This trend showcases the evolving preferences of Australian consumers and underscores the need for streaming service providers to calibrate their offerings to different market landscapes.

How are streaming services confronting subscription fatigue in Australia?

The Streaming Study data has revealed that 34 percent of the participants chose to discontinue subscriptions within the past year. Equally noteworthy, 39 percent of respondents intend to follow suit within the upcoming year. These statistics collectively hint at a market saturation that has given rise to subscription fatigue.

This saturation-driven phenomenon is confirmed by the 10 percent decline in the average number of subscriptions held by individual subscribers. The dynamics are prompting 45 percent of Australian respondents to consider canceling an existing subscription before subscribing to a new one.

Consequently, streaming services have had to make strategic adaptations. Providers are now exploring elevated pricing and including advertising within plans. These tactics are devised to capitalize on the remaining user base and counteract the attrition of customers who prioritize price sensitivity.

In a similar vein, several streaming platforms have embarked on an innovative path by integrating gaming into their offerings. This fusion of entertainment avenues seeks to introduce a diversified experience and combat the mounting sense of fatigue among users. Such adaptations underscore the dynamic and competitive nature of the streaming industry as it navigates the challenges posed by subscription saturation.

In what ways can streaming service providers deal with market saturation and prevent subscription churn?

In the face of this evolving landscape, streaming service providers must gain a comprehensive understanding of their market positioning. This entails a thorough examination of their performance across vital purchase criteria, both among their existing subscriber base and beyond. This introspection helps identify avenues for enhancement and differentiation in an increasingly saturated market.

Given subscriber price sensitivity and the resulting churn, a strategic recalibration of pricing and packaging options is imperative. This will allow platform offerings to retain their competitive edge. Furthermore, the adoption of data-driven sales strategies is essential in this scenario. By harnessing the power of data insights, providers can craft targeted approaches that resonate with their audience, bolstering subscriber loyalty and building a foundation for enduring user engagement.

Reach out to our experts to learn more about the Australian streaming market.
Want to know our global results? Check out episode one of our Streaming Study.

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