Wednesday, 20 March 2019 19:13

Netflix claims 11m Australian users, as pay TV/subscription TV market growth soars

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Netflix says nearly 14 million Australians now have access to some form of pay TV or subscription TV, up 11.8% on a year ago, with the increase driven by Netflix as well as other SVOD services including Stan, YouTube Premium and Amazon Prime Video.

Netflix claims that over the last year it has continued to lead the growth of subscription video on demand services, with more than 11.2 million Australians in the three months to February 2019 now having a Netflix subscription in their household – up by 25.2% on a year ago.

According to Netflix, the leading Australian-owned SVOD is Stan which is now accessible by more than 2.6 million Australians “up an impressive  45.2% on a year ago”. Stan is a fully owned subsidiary of the Nine Entertainment Company.

Netflix also says that smaller SVOD services including YouTube Premium (formerly YouTube Red), Fetch and Amazon Prime Video also experienced significant increases in users over the last year.

The company says YouTube Premium (formerly YouTube Red), now has over 1.2 million users, up 31.9% on a year ago and Fetch now has nearly 760,000 users, up 9% on a year ago.

“However the largest increase was for Amazon Prime Video which more than doubled its user base over the last year by 116.7% to over 570,000,” Netflix notes. (See Roy Morgan's graphic on all these figures at the end of this article.) 

Michele Levine, chief executive, Roy Morgan, said, “Pay TV/Subscription TV services are an increasingly competitive marketplace in Australia.Going forward the battleground will be content and cost.

“To charge for a service there needs to be unique valued content e.g. live sport. Just this week we have learned that Australia’s leading football code the AFL has been approached by well-known global streaming giants about acquiring the rights for the AFL when the next rights deal begins in 2023.

“Foxtel has recently launched its own live-sport streaming service Kayo Sports which now reaches over 150,000 Australians only a few months after being launched. The AFL & NRL seasons which are now beginning will provide a significant boost to Kayo Sports’ subscriber numbers.

“Before the advent of Streaming Video on Demand services Foxtel enjoyed the benefit of inertia - but Australians are a mobile lot and Roy Morgan data shows around 1-in-6 Australians move house every year – and when we move house we make decisions about landlines, energy suppliers and Foxtel subscriptions.”

Levine said analysis of Roy Morgan’s Technology Adoption Segmentation showed that “Foxtel had moved into the mainstream in its heyday. However, contemporary analysis shows that newer entrants to the market that were initially being adopted by ‘Early Adopters’ and ‘Digital Life’ are now becoming mainstream themselves”.

“In its early days, Foxtel was also being driven by families with children – with extra content focused on kids programs and educational programs etc. Now young people have so many more options they aren’t one of the factors pushing their parents to have Foxtel.

“One factor that remains in Foxtel’s favour is its almost ubiquitious use in pubs, clubs, hotels and other outlets around Australia for watching sport. These Foxtel subscriptions which may number in the hundreds of thousands are not captured in the Roy Morgan consumer data which concentrates on households. Many Australians who watch sport on Foxtel in pubs and clubs around Australia are themselves not subscribers to Foxtel although they do consume Foxtel outside the family home.”

Australian household users of Pay TV/Subscription TV services – 3 months to February 2019 cf. 3 months to February 2018:

Source: Roy Morgan Single Source, December 2017 – February 2018, n=11,750 Australians aged 14+ and December – February 2019, n=12,599 Australians aged 14+. 

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Peter Dinham

Peter Dinham - retired in 2020. He is a veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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