How Bundling SVOD Services Reduces Subscriber Cancellations

In a recent report on streaming subscription services, Antenna found that in 2024, the churn rate among the top U.S. premium SVOD providers dropped in the final three months of the year. This was a positive change compared to prior months. Despite this improvement, the overall churn rate in 2024 remained high.

Throughout 2024, the top nine SVOD providers added 174.3 million subscribers, but 147.8 million cancelled their subscriptions. This resulted in only 26.5 million net new additions, the lowest in three years. The retention rate for 2024 was just 15%. In comparison, 2023 saw 156.1 million new subscribers and 127.6 million cancellations, resulting in 28.5 million net new additions and an 18% retention rate.

Looking back at 2022, Antenna reported 134.8 million new SVOD sign-ups, with 97.9 million cancellations. This led to 36.9 million net additions and a 27% retention level. Over the three-year period, the total gross additions were 465.2 million, with 373.3 million cancellations, resulting in 91.9 million net additions.

Antenna’s report also highlighted that 25% of subscribers who cancel their SVOD service end up signing back up within three months. When including these re-subscribers, the average monthly churn rate is less than 3%.

Additionally, Antenna mentioned that the average monthly subscription rate for SVOD services continued to rise in 2024. The average cost for an ad-free subscription was $13.88 per month, a 23% increase in two years. The average cost for an ad-supported tier grew to $7.57 in 2024, a 25% jump.

One interesting finding was that the more affordable ad-supported tiers accounted for 57% of new sign-ups on streaming platforms where they were available. However, the retention rates for ad-supported plans were similar to ad-free tiers.

Antenna’s analysis pointed out that third-party initiatives and bundling have been effective in introducing consumers to different SVOD providers. For example, Apple TV+ gained over 1.5 million subscribers from Amazon Channels in the last quarter of 2024. The Disney-Max bundle, which includes Disney+, Hulu, and Max, has also been a success since its launch in July 2024.

According to Antenna, the Disney-Max bundle attracted over 20% of new Max customers in the first six months. Additionally, 80% of the customers who subscribed in the second half of 2024 were still subscribers three months later. The retention rate for the Disney-Max bundle surpassed that of the Disney bundle, Max as a standalone service, and even Netflix, standing at around 55%.

In May, Comcast introduced Xfinity StreamSaver, a bundle that combines Peacock with Apple TV+ and Netflix for certain Xfinity subscribers. This service is priced at $15 per month with ads, offering a 35% cost savings.

Overall, Antenna believes that these cross-company bundles could be a game-changer for the industry and a key part of its future success, stating, “It’s still early, but we really think this is a wake-up call for the industry. These cross-company bundles could really be a game-changer and a big part of the solution for the industry going forward.”