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Netflix Drop A Symptom of Slowing Streaming Subscription Market: Kantar

The shocking drop of 200,000 subscribers reported by Netflix in the first quarter is part of a larger slowdown in the streaming market, particularly in the U.S., according to new data from Kantar On Demand.

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(Image credit: Kantar)

Kantar found that first quarter subscription VOD penetration was down slightly at 81.4% compared to 81.6% in the fourth quarter.

Netflix penetration was down 0.3% in Q1, following a 0.5% decline in Q4. Amazon Prime Video was down 3.2%, Apple TV Plus dropped 15.6%, Discovery Plus was off 3.8% and Paramount Plus dipped 0.6%.

At the same time, the average number of subscriptions consumers pay for levelled off at 3.7.

Kantar found that ad-supported VOD services were still growing, but growth is slower than last quarter. Penetration is now 25.3%, vs 24.4% in Q4 and 20.8% in Q3.

Positive news for streaming is that planned cancellations are down, with 4% planning to cancel services, down from 5% in the fourth quarter.

Saving money is still the #1 reason given for cancellation, but it has not significantly driven a greater proportion of cancellations this quarter. Instead, content is more likely to drive cancellation particularly when subscribers sign up to watch a specific series or film, and then cancel. They also cancel if they find it too hard to find the content they want to watch.

The price-driven cancellations are linked to Netflix for raising its prices and to Apple TV Plus because a free trial ended for many subscribers. ■

Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.