Stacking behavior is changing. The trend towards homes taking more SVOD services is slowing down and, in some markets, declining. Conversely, the number of free video services being used is increasing—with YouTube heading the field.
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Summary
In recent years, there has been a trend towards households taking an increasing number of paid-for online video services. However, the rate of increase is slowing down and, in some markets, even going into decline. Conversely, the number of free video services being used is increasing—with YouTube heading the field.
Free viewing increases its lead over SVOD
Omdia unveiled some important new data insights at this week’s Connected TV World Summit 2024. It revealed that after more than five years of an increasing trend in stacking behavior, the once-dominant streaming model is beginning to show signs of strain. Deep analysis of findings from Omdia's November 2023 survey shows that the number of subscription video-on-demand (SVOD) services per home has declined in a number of markets for the first time.
At the same time that SVOD growth was losing momentum, the data shows that the stacking of free video services was still on the rise. YouTube's continued progress as the top video service provider in key markets has been fundamental to the growth of the free sector's lead over paid video content. This has been buoyed further by strong growth in other social video platforms and free ad-supported television (FAST) services.
Figure 1: Top 10 video services by monthly usage by market, November 2023
Source: Omdia Consumer Research – Devices, Media & Usage Spotlight Service
Omdia’s research plainly shows that the appetite for free content is ever-increasing, and the major streamers are clearly leaning into this as a strategy; by the end of 2024, all major SVOD services will have advertising tiers.
FAST services have continued their upward trajectory in the US, with key players Tubi and The Roku Channel entering the top 10 most-used services on a monthly basis. In Europe, however, broadcasters remain strong, with traditional free TV and broadcaster video-on-demand (BVOD) services leading.
Over the last year, Omdia research has found that the average number of free video services being used per video user in the UK increased from 5.1 to 6.2, and in the US from 6.0 to 7.5. In the UK, free-to-air content continues to lead, with BVOD services and social media platforms as the most popular services with FAST in third place.
Figure 2: Average number of services per video user by country, April & November, 2020–23
Source: Omdia Consumer Research – Devices, Media & Usage Spotlight Service
The allure of social media platforms, such as TikTok and Instagram Reels, has reshaped how video content is consumed. With engaging formats and vast user bases, social media services offer compelling alternatives to mainstream streaming services. Similarly, the availability of free TV options, such as ITVX, BBC Player, and Channel 4 in the UK, provides viewers with access to high-quality content without the burden of subscription fees.
The landscape of video streaming services continues to undergo a significant transformation. Omdia’s data has found that social media platforms, particularly Instagram Reels, coupled with the rise of the aforementioned free TV options like ITVX, BBC Player, and Channel 4, has led to notable changes in British consumer behavior. Even though these changes may partially be happening in response to cost-of-living increases, paid subscription fatigue, or other factors, it still underscores the evolving preferences of consumers who increasingly have more places to go to access video content.
Appendix
Author
Maria Rua Aguete, Senior Research Director, Media and Entertainment
