Australians flock to on-demand streaming

Around 2 million Australians were using paid movie and TV streaming services like Netflix and Stan at the end of June, according to research.

This is up from 315,000 subscriptions at the end of December 2014, with new services, free trial periods, and promotions offered by ISPs, mobile carriers and TV manufacturers, said analyst firm Telsyte.

Telsyte’s Australian SVOD/OTT Video Market Study 2015 shows that around 1.5 million of these subscriptions have been converted to fee paying and generated more than $17 million in revenues in June.

Netflix hit the ground running on March 24, signing agreements with broadband providers Optus and iiNet to offer Australians ‘un-metered’ or quote-free access to the streaming service.

It backtracked on these deals in April when CEO Reed Hastings said the streaming provider should have avoided signing these quota-free access deals because data caps inhibited innovation and were bad for consumers.

Netflix is the leading provider of paid services, followed by Stan, Presto and Quickflix with this top four representing 90 per cent of the paid subscription market.

However, there is a list of providers covering sports and special interest niches such as AFL, NBA basketball, NRL and UFC matches, Telstye said.

“The early success of SVOD providers will encourage more film studios and content rights holders, including sporting codes, to consider direct streaming to consumers,” predicted Telsyte’s managing director, Foad Fadaghi.

Subscribers have an average of 1.6 services due to the complicated web of streaming content rights and widespread availability of free trials. Almost 40 per cent of households that had SVOD services also had traditional pay TV, Telstye said.

Pay TV subscriptions – including Foxtel, Fetch TV and others – were estimated to be 3.1 million at the end of June. Telsyte also estimated that 7 million Australians aged 16 years and over view Catch-up TV services such as ABC’s iView and Channel Nine’s 9Jumpin at least once a month.

Meanwhile, Telstye expected SVOD and Catch-up TV services to drive NBN adoption, particularly with the arrival of 4K (ultra high definition) content over the Internet.

Its research found that 22 per cent of broadband users intend to upgrade their fixed broadband due to streaming video and more than half (53 per cent) believe their current fixed broadband connection may not be fast enough for streaming video services.