Here's some more bad news for Netflix, Apple TV, Amazon Prime, Disney+ and the various and sundry streaming competitors (including the already struggling CNN+): in the face of a worsening inflation crunch, consumers are canceling their streaming subscriptions at a "record" pace.
At least, that's the takeaway from the latest streaming data out of the UK.
According to the FT, which cited figures from analytics organization Kantar, British households walked away from about 1.5 million video on-demand accounts during the first three months of the year, an unprecedented number suggesting that consumers are becoming more "discerning".
To be sure, 58% of households retain at least one streaming service, a decline of only 1.3% from the end of 2021. But the terminations suggest that viewers have become more discerning about subscribing to multiple platforms.
Most of those canceling their subscriptions cited a desire to save money as the most important reason for canceling their subscriptions, and young adults have become particularly wary of paying for television on top of an annual £159 licensing fee.
The global insight director from Kantar described the streaming-cancellation figures as "sobering".
The findings were “sobering” for streaming providers, said Dominic Sunnebo, global insight director at Kantar. He said streaming services had to prove their worth to consumers “in what has become a heavily competitive market”.
As we noted earlier this month, living standards in the UK are declining at the fastest rate in 8 years due to a 'death spiral' spurred by soaring energy costs.
As a result, high inflation has pushed the UK Misery Index, an economic indicator to gauge how the average person is doing, to three-decade highs.
Of course, for investors, fears about 'oversaturation' in the hyper-competitive streaming space have caused shares of the once-dominant Netflix to shed more than 40% of their valuation since the start of the year after reporting its worst quarter in half a decade.
Netflix, which recently implemented its second round of UK price increases within 18 months, raising standard monthly subscriptions from £10 ($13) to £11 ($14.3).
Circling back to the UK, Kantar's data showed Britbox, Apple TV Plus and Discovery Plus had the highest churn rate, meaning they lost the most users on a gross basis. Disney Plus had the biggest increase in its churn rate, Kantar said. Its quarterly churn tripled from the previous quarter to 12%. Meanwhile, Netflix and Amazon Prime enjoyed the lowest churn rates, suggesting that users would cut them last during a period of belt-tightening.