Specialized Streaming Services Continue to Grow Despite Crowded Market, but Will They Survive Age of Consolidation?
It’s hard to overemphasize just how big a shift the streaming marketplace is undergoing nowadays. When streaming first entered the video entertainment ecosystem, its main objective was to differentiate from the pay-TV model that many American customers had become accustomed to.
Nowadays, streaming is essentially the top dog in video. The problem for streaming operators is that unlike in the old days, when a big influx of new subscribers led to a corresponding jump in stock price, streamers now have to show Wall Street that they have a viable plan to make a profit.
This is especially critical for specialized streaming services that offer niche content to a very targeted audience. Data released by Antenna as part of its “State of Subscriptions” 2023 report shows that the 25 specialty subscription video-on-demand (SVOD) streamers it tracks have grown their share of total streaming subscriptions by a rate of 11.5% year-over-year thus far in 2023, the fourth year in a row this category of streaming services has grown their market share.
The numbers from Antenna show that niche streaming platforms like AMC+, MGM+ and Shudder are continuing to gain unique new subscribers. Since the start of 2022, Antenna has observed an average of 2.4M unique individuals per quarter subscribing for the first time to any of the specialty streamers it measures. At the beginning of 2019, Antenna was tracking 8M American users on specialty streaming services; that number as of the end of Q2 of 2023 is 40M, a 400% increase.
The compounded annual growth rate (CAGR) of specialty streamers is 43%, much higher than the CAGR of premium streamers like Netflix and Disney+, which sits at 15%. All of these figures would seem like good news for specialty streamers, but will it matter in the face of a market that now demands profitability from streaming platforms?
It may be that, like niche free ad-supported TV (FAST) channels, specialty streaming services are simply crowded out of the marketplace going forward. Services like AMC+ often carry 20M subscribers or less, which means collecting higher revenues via scale will simply not be possible.
What’s more likely, however, is that these services will be absorbed by the premium SVODs out there. Customers are getting a potential preview of what that might look like now, as Max is currently hosting seven series from AMC+ until the end of October. Warner Bros. Discovery CEO David Zaslav has predicted a future of bundled and merged streaming platforms more than once, warning earlier this year that such a future was inevitable.
“If we don’t do it to ourselves, I think it will be done to us,” Zaslav said.
This data from Antenna could be especially useful to premium SVODs like Max when determining which specialty services they might pursue in the coming years. Niche streaming services are fantastic at super-serving targeted audiences with specialized content, but they are likely not built to survive the evolving streaming landscape in the long term.
AMC+
AMC+ is a premium streaming bundle that includes the best from AMC, BBC America, IFC, SundanceTV, Shudder, Sundance Now, and IFC Films Unlimited containing original, award-winning series, popular movies, festival favorites, plus horror, sci-fi, true crime, and thrillers. You can subscribe to AMC+ for $4.99 / month or save with the annual plan for $59.88 / year.