Streaming Fatigue

Subscriber Retention Issues for SVODs


May 11, 2022

What makes a good subscription streaming provider? A service that offers an intuitive platform, quality content, programming variety and frequent new releases for a competitive price should have no problem winning over viewers. But once they’ve got them reeled in, the job is only half done. Now they have to figure out how to keep them hanging around.

It’s an escalating problem for many SVOD services: churn. Viewers who subscribe to a platform, binge or exhaust their preferred content, then unsubscribe and move on to another provider, are causing streaming services all sorts of headaches. And according to one expert in the space, the problem won’t be going away anytime soon.

In fact, in Deloitte’s 2022 Digital Media Trends survey, the firm reported a churn rate of 37 percent for streaming services in the United States, with more than half of millennial and Gen Z respondents admitting to adding, canceling or both adding and canceling a streaming service in the past six months. Streaming fatigue is a real thing.

Platform hopping isn’t illegal, or even necessarily immoral, but it has become a significant enough threat to the SVOD model that providers are being forced to think about what’s behind the churn. Recent hikes in streaming prices have prompted some viewers to work around them to find content. New platforms coming to market have given consumers more options, prompting some subscribers to jump ship from one or more of their subscriptions. There’s even the theory of analysis paralysis – that there may actually be too much content available, making viewing decisions more difficult for subscribers.

At Netflix, one answer to the latter problem was adding a “shuffle” feature to the user interface. The general idea: Tap into some of the unpredictability and spontaneity of traditional television, and bring it to SVOD. Trouble is, if you’re a streaming viewer who doesn’t feel like scrolling for content and decides you aren’t moved by the provider’s random selections, you might be even less likely than the average subscriber to hang around and fork over a premium fee.

As an alternative to SVOD, more viewers are turning to AVOD or FAST. The linear formatting and low-to-no-cost model behind FAST are reducing streaming fatigue. With a standard set of options (much like those of traditional television), viewing decisions become simpler for viewers. At a fraction of the price of SVOD – or no price at all – subscribers are less likely to opt out of the service. And the ongoing, 24/7 format of FAST channels like those powered by Frequency keeps viewers engaged at their own convenience, a model often entirely supported by advertisements rather than user fees.

Some of the streaming subscription churn we’re seeing is tied to the industry’s current exploration of what works in the market and what doesn’t. What we know, however, is that standard SVOD is an imperfect, likely unsustainable distribution model that is leaving too many subscribers with streaming fatigue. AVOD and FAST won’t solve viewer retention on their own – but they represent fast-growing alternatives that help the streaming space better meet the needs of consumers.

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