02 Jan The Streaming Services That Are Priced Right – and the Ones That Miss the Mark | Chart [TheWrap Pro]
BY CHRISTOFER HAMILTON
January 2, 2023 | When you consider demand for their content, Netflix and Discovery+ ad-free subscriptions are a great deal, while a few SVODs are overcharging their users.
In an inflationary environment, it’s important to understand which streaming services will have the leeway to charge consumers more. The central value proposition streaming video on demand services (SVODs) offer to their subscribers is a catalog of content that they want to watch for a recurring subscription price. The key point being that it isn’t just catalog size that makes subscribers value a platform but how desirable that content is. That’s why demand is important to understanding what price point a platform should set to be a compelling deal for subscribers and stay competitive with other platforms. We see a clear relationship between the total demand for content on each platform (movies and TV series) and the price point each platform charges consumers.
As streamers continue to raise prices but consumer budgets are squeezed, it will be important to strike a balance between keeping up with rising costs while not triggering subscriber churn. With Wall Street’s focus on these platforms shifting from simply looking at net subscriber adds to scrutinizing streaming revenue, the ability to charge consumers more will help these streamers move towards becoming profitable.
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