Rise in ad-tier subscribers for streaming platforms in the UK

The streaming landscape in the UK is undergoing dynamic changes, with ad-supported tiers becoming increasingly popular among viewers. The latest data unveils a remarkable shift in how British households consume content, driven largely by economic factors and the evolving strategies of streaming giants.

A growing trend: Netflix and Disney+ gain ground

In the third financial quarter of 2024, both Netflix and Disney+ witnessed significant growth in their ad-tier subscriptions. According to recent insights:

Netflix saw a substantial rise, with 13.1% of its UK base opting for the ad tier, translating to 3.8 million homes. This number is an increase from 2.78 million homes in the second quarter.
Disney+ also noted progress, jumping from 820,000 homes in Q2 to 1.2 million in Q3, now representing 4.1% of its subscriber base.

This shift indicates a broader acceptance of ad-supported models as subscribers seek more affordable options amid rising living costs.

Prime Video+ dominance

Although specific data for Prime Video+ in Q2 wasn’t disclosed, the third quarter figures reveal that 86% of homes with access to the platform are utilizing the ad tier. This dominance underscores Prime Video+’s leading position in the ad-supported sector, demonstrating its extensive reach and adaptability.

Economic impacts on streaming habits

The increased adoption of ad-supported tiers can be attributed to the ongoing cost of living crisis in the UK. As financial pressures mount, many streamers face the challenge of balancing profitability with subscriber retention:

Overall access to at least one streaming platform per UK household remained steady in Q3, exceeding 20 million households.
However, homes subscribing to at least two services dipped below 14 million, reflecting a cautious approach to additional expenses.

Stability and competitive landscape

Despite economic turbulence, the UK streaming market shows signs of stability. Among the most popular paid-for platforms:

Netflix saw a marginal growth of 0.4%.
Apple TV+ increased by 0.3%.
UK-exclusive Now (operated by Comcast-owned Sky) grew by 0.2%.

Conversely, Prime Video and Disney+ experienced slight declines, at 0.8% and 0.4%, respectively. On the other hand, access to Paramount+ and Discovery+ remained unchanged, at 9.7% and 11.1% of homes.

Insightful reflections

Doug Whelpdale, head of insight, noted that after robust growth in the first two quarters, a slowdown was anticipated. The overall number of homes with SVOD access stayed above 20 million, reinforcing the sector’s resilience.

“This steadiness,” Whelpdale commented, “illustrates why services are delving into alternative revenue streams. While Amazon’s ad tier is likely to remain dominant, Netflix’s growth to nearly 4 million homes and Disney+ surpassing 1 million homes reveal the potential of ad-supported models.” With approaching winter and the festive season, these numbers are expected to rise further.

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