One-third (33%) of total new paid streaming TV subscribers in the UK chose ad-supported tiers in Q1, up two percentage points from the previous quarter.
That is according to Kantar’s latest Entertainment on Demand report, which found increased support for ad-supported plans from Amazon Prime Video, Disney+ and Netflix.
Two-thirds (65%) of new Netflix subscribers chose its ad tier in Q1, up from 42% in Q1 2024. The same was true for a majority (56%) of Disney+ sign-ups.
Meanwhile, 83% of new Prime Video subscribers entered the ad plan — although it is worth noting that Amazon defaults new Prime users to the ad tier for its video offering.
Of all new ad tier subscribers across services, 27% cited “value for money” as their primary motivation for choosing that option, implying a substantial sub-group of ad tier consumers are more likely to be financially strapped or otherwise cautious with regard to entertainment purchases.
However, planned cancellations were lower among ad tier subscribers than standard plan subscribers, suggesting that cheaper monthly costs discourage churn.
Netflix was found to maintain the industry’s lowest rate of churn in Q1 at just 2% per month.
Apple TV+ and Mubi big Q1 winners
Dominic Sunnebo, global insight director at Kantar’s Worldpanel division, commented: “Ad-supported tiers are continuing to help platforms like Prime Video, Netflix and Disney+ stay ahead by offering a more affordable way to access TV and movies, and shows that British audiences have become more receptive to ads in general.”
According to Entertainment on Demand, Prime Video did not experience its typical seasonal drop in subscriber share during Q1. In past years, subscribers churned during the post-holiday period, but the platform experienced both a drop in planned cancellations during the quarter and it also received the highest share of new subscribers of any streaming platform (17%).
Prime Video action drama Reacher ranked as the most-watched streaming title in Q1, followed by Toxic Town (Netflix) and Yellowstone prequel 1923 (Paramount+).
UK ’emblematic’ of Netflix’s approach to global programming
Meanwhile, Apple TV+ is “gaining ground fast”, according to Sunnebo, thanks in part to acclaimed dramas such as Severance, Slow Horses and The Studio.
Apple TV+ secured 16% of new streaming service subscribers, with 37% of them signing up specifically to watch series two of Severance. Its subscriber base grew 5% quarter on quarter and churn rates fell to the single digits (7% in March) for the first time since Apple TV+ launched in 2019.
Sunnebo also pointed out that Mubi had an exceptional Q1, “proving there’s strong demand for unique and curated experiences”.
The streaming service, which specialises in arthouse and independent films, grew its subscriber base by 64% — its best-ever quarter — with a heavy skew towards the valuable 25-34 demographic.
Many users were attracted to watch body-horror flick The Substance during awards season, likely taking advantage of a promotional offer of £1 for three months’ access to the platform. According to Kantar, retaining these users therefore “may prove challenging”, especially as Mubi subscribers averaged using six other streaming services.
Sunnebo concluded: “The competition in this streaming market remains fierce and it’s clear that viewers want flexibility, value and content that speaks to them.”
