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Subscription entertainment services growing despite cost of living pressures

The cost of living is on the rise and petrol prices are soaring, but our love for streaming and subscription services are defying all the trends with 16 per cent growth in the past 12 months.

The Telsyte Australian Subscription Entertainment Study 2022 Shows our entertainment subscription services have become essential items for Australians across video, games and music.

The rapidly increasing demand for at-home entertainment has seen the number of services increased by more than six million to 48.4 million during the 12 months to June 2022.

Subscription video on demand (SVOD) like Netflix, Stan and Disney+ saw the largest growth at 22 per cent followed by games-related subscriptions (19 per cent) and music services (17 per cent).

At the same time traditional pay TV continued its decline with a 9 per cent year on year drop.

According to the Telsyte study, streaming entertainment is now considered essential for more than half of Australians – 54 per cent SVOD and 52 per cent for music.

And the growth is set to continue with games being the fastest to increase by 2026 according to Telsyte.

Subscription video on demand services increased by 22 per cent in the 12 months since June 2021 to reach 23.4 million – up from 19.2 million.

Last year 62 per cent of households had at least one SVOD service, that is now 70 per cent in 2022 with that number increasing to 77 per cent among households on the NBN.

Netflix still rules the roost as the top SVOD provider with 6.3 million subscribers followed by Amazon Prime Video (4.1 million), Disney+ (3 million) Stan (2.5 million), Kayo Sports (1.3 million), Binge (1.3 million), Paramount+ (1.1 million) and Optus Sport (1 million).

Annual revenue from SVOD has been estimated at $2.7 billion for the 2022 financial year – that’s an annual increase of 27 per cent.

The average number of SVOD subscriptions per subscriber in Australia climbed to 3.3 in June 2022 – up from 3.1 in June 2021.

Around 35 per cent of SVOD users (1 in 3) are also interested in the more affordable ad-supported service plans.

Telsyte says ad-supported subscriptions could increase the number of subscriptions per household closer to 4 by 2026. It is currently 3.3.

Gaming continues to be popular with Australians taking up 8.3 million games-related subscriptions to the end of June 2022 – that’s an increase of 19 per cent year on year.

Video game subscriptions have been the main growth area experiencing a boost of 56 per cent to 4.8 million in June 2022.

The Microsoft Xbox Game Pass is the most popular in this category with Sony’s recently launched PlayStation Plus service with the number of plan options.

Music streaming subscriptions increased by 17 per cent from a year ago to reach 15.7 million by June 2022.

In Australia, the top three streaming music service providers Spotify, Google (including YouTube Music in YouTube Premium) and Apple Music.

Amazon Music is becoming increasingly popular as part of the Amazon Prime subscription.

Podcasts are also on the rise and considered an essential part of streaming music providers growth strategy with Telsyte reporting that one in four Australians aged 16 and older listened to podcasts in 2022.

The most popular genres were found to be comedy, news and politics and education.