Telsyte: Entertainment subscription market grows 5%

The Australian entertainment subscription market, which includes video, music and game services, grew by 5% to 52.3 million services in the 12 months to June 2024, according to research by technology analyst firm Telsyte.

The Telsyte Australian Subscription Entertainment Study 2024 found despite a stronger impact of cost-of-living pressures, entertainment subscriptions remain essential to Australians, with around half of SVOD and streaming music users considering their services vital in meeting their entertainment needs.

The study indicates the market is maturing, particularly in SVOD services, where most (over 70%) subscribers now have more than one service. Growth rates are in single digits in SVOD (4%), streaming music (9%), and games-related subscriptions (6%), with streaming music's higher growth was boosted by the launch of TikTok Music during this period.

Subscriber growth in SVOD - which has reached 25.3 million as of June 2024 - was attributed to a population increase, the introduction of more affordable ad-supported plans, and strong consumer interest in diverse content across multiple services.

Revenue growth was driven by subscription cost increases and increased service adoption.

Hubbl's executive director, Dani Simpson, said Hubbl is well positioned for growth as streaming apps become utility entertainment items in households, even through difficult economic times.

"Hubbl offers users choice and convenience by fusing all major streaming services with free-to-air apps into one easy to use interface making it easier than ever to find content you love. Hubbl is also unique in offering ongoing savings on monthly subscriptions through Hubbl Stack and Save," said Simpson.

“The report shows that future growth will come through bundling and this year you will see Hubbl make a number of bundling options available to customers, unlocking savings on devices as well as content subscriptions.”

Netflix remains the clear leader with 6.2 million subscriptions at the end of June 2024, followed by Amazon Prime Video (4.8 million); Disney+ (3.1 million); Stan (2.6 million); Paramount+ (1.8 million); Binge (1.6 million); Kayo Sports (1.6 million); and YouTube Premium (1.0 million).

Excluding dedicated sports services that serve ads during live sports broadcasts, Telsyte’s research found there are some 2.5 million SVOD subscriptions subsidised by advertisements (June 2024), up from around million a year ago.

Ad-supported subscriptions now account for 11% of the total SVOD services. Close to 1 in 2 (45%) of SVOD users are interested in an advertising-supported plan, a 9% increase from a year ago.

While demand for video subscription entertainment remained strong, paid SVOD services rank 8th among areas where consumers had reduced spending in the last 12 months, compared to 10th a year ago.

Among those willing to pay for streaming video services, the average monthly budget has marginally declined by 2% to just under $36, adding to last year's 7% increase. The hardest hit consumer segments that saw their SVOD budgets reduced the most are young families and individuals with a medium income.

The study found the SVOD market revenue (excluding advertisements) reached an estimated $3.5Bn for FY2024, a 15% year-on-year increase driven by cost rises and increased service adoption.

Australians are also allocating more time for free and ad-supported streaming services due to the rising cost of living, with 40% (up 8% year-on-year) claiming they are relying more on free services due to budget constraints.

According to Telsyte’s research, the average total weekly video entertainment consumption increased by 4% year-on-year to 47 hours, driven by free sources such as BVOD, YouTube and videos on social media.

BVOD services - including 7Plus, 9Now, 10Play, ABC iView and SBS On Demand - remained popular and most BVOD platforms had more than 11 million viewers during FY2024. 

Nearly five million Australians claim they have used Free and Ad-supported streaming TV (FAST) services or services that offer FAST channels in the last 12 months. The FAST market has quickly expanded over the last 24 months, with services such as Samsung TV Plus, LG Channels and Plex. Dedicated FAST channels can also now be found on all of the BVOD services and Fetch’s platform.