Streaming providers had a tough year in 2022. The market underwent a significant reset in terms of how it rewards services for doing business. Streamers now have to identify a viable route to profitability in order to be rewarded with investor confidence, instead of simply showing Wall Street a slew of new subscribers every quarter.
One of the reasons that subscriber numbers are no longer the most relied-upon metric for determining a streamer’s health is the fact that there are simply not that many customers out there left to reach. Between 80-85% of all TV watchers in the United States now have at least one streaming service, meaning that the addressable market for streaming services has grown fairly small. The new “State of Subscription Streaming” report from market research firm Antenna is highlighting just how mature the streaming marketplace has become.
Antenna’s report shows that total premium streaming subscriptions across the whole market increased by 14.1% in 2022. That may seem like robust growth at first, but it’s less than half of the 28.9% industry-wide increase streamers saw in 2021. Year-over-year subscription growth was down in every quarter of 2022 as compared to 2021, and the second quarter of last year saw the lowest number of net subscriber adds of any quarter since 2019.
The data from Antenna also shows how many customers canceled a streaming service and where they went from there. The good news for the industry is that these customers were not leaving streaming altogether; there were 117 million cancelations across premium subscription streaming services in 2022, an increase of 49% over 2021. But there were also 143 million gross additions, an increase of 18% over 2021’s figure.
Customers were most likely to be leaving Netflix, Disney+, or Hulu; each of those three services lost at least one percent of their market share over the course of the year, with Netflix taking home the unwanted distinction of shedding the largest percentage of users. It lost 5% of its total market share in 2022, whereas Paramount+ and Peacock were the biggest gainers. NBCUniversal’s streamer picked up four percentage points over the year, and Paramount+ snagged an additional 2% of the streaming market.
Partly, Antenna’s data shows that the more things change, the more they stay the same. There were definite losses and gains by certain streamers over the course of 2022, as shown above, but the overall hierarchy of market share remained the same, demonstrating that customer loyalty and brand awareness are still powerful market forces, despite rising churn rates.
The numbers from Antenna’s survey reinforce those from another study in early 2023 that shows where new streaming subscriptions will come from this year. That survey indicates that Latin America will see the largest growth in streaming customers of any global region in 2023, highlighting the fact that the North American streaming industry is bumping up against its ceiling in terms of the addressable market.