Report: 46% Have Canceled a Streaming Service Due to Cost Concerns; Time Spent Watching Free Streaming Increasing
Economic uncertainty just plain stinks. It’s the reality we live in, however, as market forces will do what they’re going to do regardless of what has the best effects on people’s bank accounts. Given that knowledge, it’s often left to consumers to decide the best ways to allocate their money in a given month.
According to a new survey from LG Ad Solutions, almost half have decided that a streaming service is one of the best places to start cutting back when budgetary numbers don’t add up. The survey indicates that 46% of respondents canceled a streaming service because of economic concerns, and 53% of streaming users have cost concerns. That’s even higher than the number of users who reported being concerned about the costs of cable and satellite.
These numbers point to the ease of cancelation of streaming versus linear pay TV. Users think of their streaming subscriptions as more discretionary, because they can cancel at any time before their next billing cycle and walk away with no further obligations. Pay-TV contracts are notoriously longer in length, leading users to think of them as more essential, since they’re often stuck paying for them whether they’re ready to cancel or not.
These cost concerns have not led to a slowdown of cord cutting, however. The amount of respondents who say they watched less linear TV than the year before remained consistent at 21% in 2023, while the number of people who reported watching more linear TV declined by eight percentage points.
So where are these viewers going if they’re watching less subscription video streaming and less pay TV? Free ad-supported streaming is the big gainer here. Sixty-three percent of respondents said they prefer free ad-supported content to a subscription service that costs money, and more than a quarter (27%) said they watch between 2-5 hours of free ad-supported TV apps every week.
LG expects the trend of users shifting away from subscription streaming and pay TV and into free streaming to continue, as well. Over the next year, it projects that 32% of users will remove a connected-TV subscription service, while 21% will add a free ad-supported option to their entertainment lineup.
There are any number of reasons users cancel a streaming service. Sometimes it’s because they only signed up for one particular title on a streamer, and have since finished that content. LG’s numbers indicate that 59% of users are willing to do so, which reinforces another survey from earlier this year that showed 69% of streaming users were considering engaging in this behavior this year.
Other times, users cancel because a service introduces security measures they consider too harsh. That may be the case for Netflix this year if it chooses to carry out plans to crack down on password sharing; over a third of current Netflix subscribers say they’ll cancel their service if the company carries out its announced intentions to put an end to account sharing.
Streamers would do well to keep introducing free, ad-supported streaming options if they want to keep users engaged. Sling TV recently launched Sling Freestream to do just that, giving users a place to get free entertainment while they wait for the next prestige series they want to see.
Sling TV
Sling TV is a live TV streaming service that helps users save money with the option of two distinct plans. The $40/month “Sling Orange” plan offers about 30 channels, including Disney Channel and ESPN. The $40/month “Sling Blue” plan offers about 40 channels, including Fox and NBC local channels.