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Streaming Subscriptions Continue to Grow Despite Slowing Spending

Joshua Thiede

As the United States attempts to rebound from COVID-19, cord-cutters are showing renewed interest in carrying multiple streaming subscriptions to their favorite services after peaking during the pandemic.

During the height of lockdowns, U.S. residents increased their streaming subscriptions to an average of 5.2 services per household in October 2020, as reported in The NPD Group’s TV Switching Study. While that number dropped to only 4.3 in 2021, subscribership saw a modest increase to 4.6 in April 2022.

Though the increase is a small one, this service stacking denotes a comeback for streamers even as viewers are leaving their houses more frequently again. According to NPD Connected Intelligence analyst John Buffone, streaming viewership is still up from pre-pandemic numbers despite more aspects of work and entertainment life opening back up. If this trend continues, it could suggest that consumers have grown accustomed to having multiple digital options despite having less downtime to interact with them.

The consumption of digital media largely falls into three categories: purchases, rentals, and subscriptions. While an outright purchase guarantees access to content forever, and renting essentially does the same for a given period of time, streaming subscriptions offer customers variety along with unique programming that can’t be accessed anywhere else, but the trade-off is that a certain portion of the content could disappear or move services at any point.

Oftentimes, the price to purchase digital content is more than subscribing to multiple services, and rentals might offer the flexibility of subscriptions, but the cost offset does not always make it a sensible option. For the cost of a single movie, consumers can get multiple subscriptions, stacking their services to provide the most content variety.

Despite the price and guarantee discrepancies, consumers are increasingly finding their digital content via subscription.

According to the Digital Entertainment Group's first-quarter 2022 report, general spending on digital rental VOD services is starting to decline while numbers show an increase in subscription spending of 4.2%.

The biggest changes in home entertainment spending have been centered around the move away digital video purchases and rentals in favor of streaming subscriptions. While people tend to be spending less on building up their individual home libraries, they are instead opting for the variety and new content from streamers.

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