Peacock and Paramount+ Generate Bulk of Q1 SVOD Growth

Those who thought Netflix’s losses in Q1 meant consumers were falling out of love with premium SVOD subscriptions overall are wrong, according to research firm Antenna, which has issued a new report indicating the streaming category continues to grow, up 4 percent in Q1 compared to Q4 2021, with a 24.7 percent jump compared to the same period the prior year. The growth the first quarter of 2022 “was largely driven by Peacock and Paramount+,” according to Antenna, which says the “two services combined to add over 6.1 million U.S. subscribers,” 80 percent of category growth.

Incumbents Netflix and Hulu continue to see their share of subscriptions fall, writes Antenna co-founder and chairman Jonathan Carson in the report summary. Carson identifies “volatility” as the single most important factor shaping the sector as driven by “a more fickle consumer and an increasingly competitive market.”

TechCrunch describes the results of Antenna’s report as “a significant indicator that Netflix is inching closer to losing its top spot in the streaming battle.” In its most recent earnings, Netflix reported a consecutive quarterly net loss of 200,000 subscribers in Q1, its first subscriber loss in a decade. The drop gave Netflix a subscriber base of 221.6 million, compared to 221.8 million at the end of 2021.

TechCrunch says “the losses will only continue, according to Netflix forecasts, and the streamer is expected to lose 2 million in the second quarter.” As a result, Netflix has “lost cachet, employees and $185 billion in value” this year, according to IndieWire.

While Antenna characterizes the Netflix news as “significant, for sure,” its Q1 report paints a more optimistic picture of the sector as a whole, with 37.4 million new premium SVOD subscriptions added that period.

“This number is consistent with the previous two quarters, but dramatically higher than previous history,” Carson writes. “To put it in perspective, in Q1 ’19 — a simpler time when Netflix and Hulu were still growing, and services like Disney+ and Peacock did not exist — we saw 10.3 million new subscriptions in the category. That is a 3 year CAGR of 54 percent.”

Looking ahead, the challenge continues to be cancellations, which have grown faster than new subscriptions. In Q1 2022, Antenna observed “just under 30 million cancellations in the category, 12 percent higher than any other quarter in history, and more than 4.5X the cancel volume of the same quarter three years prior, a 65 percent CAGR,” according to the report.

Meanwhile, in its coverage of the Antenna report, the Los Angeles Times writes that FAST channels like Paramount Global’s Pluto TV and Fox Corp.’s Tubi — each highlighted at the upfronts — are growing and “have viewers watching commercials again.”