35% of streaming subscriptions are cheaper ad-supported plans

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Subscription price hikes have pushed consumers towards budget-friendly ad-based offerings.

According to findings from analyst firm Antenna, audiences in the United States are opting for cheaper subscription plans with ads. The firm estimates that 35% of new streaming sign-ups are for the lower-cost ad tiers offered by SVOD services like Peacock, HBO Max, Paramount+, and Hulu. Cord-cutting mentality has nearly gone full-circle as costs pressures consumers back towards the ad-based models of traditional TV.

The annual growth rate of ad-based sign ups has jumped from 19% in 2020 to 35% in 2022, an increase of 17 percentage points.

"Antenna data indicates that ad-supported plan tiers continue to take an increasing share of new Premium SVOD Sign-ups. Below 20% of Total Premium SVOD Sign-ups in 2020 were to an Ad-Supported plan tier. That figure rose to 31% in 2021. In 2022 thus far, 35% of Sign-ups have been to an Ad-Supported plan option," Antenna's media and entertainment lead Brendan Brady writes.

The numbers have convinced top streamer Netflix to adopt their own ad-based plan.

Netflix recently lost over 200,000 subscribers for the first time in 11 years, with CEO Reed Hastings saying ad subscriptions would allow users to "get a lower price" and that it "makes a lot of sense" for the company. Netflix's current standard option, which offers 1080p streaming across 2 household screens, currently costs $15.49/month in the United States.