Are Rising Streaming Costs Pushing New Subscribers Away?

Streaming prices are increasing more and more by the year. Spotify has announced that they are increasing their prices, which is the second increase in just under a year. YouTube has also increased their prices, from $49 to $73 over the last 3 years. If you want a subscription to Amazon Prime, you’d be paying $140 a year, compared to the previous price of $120.

At one point, having a subscription was a great way for people to access new shows without paying the steep prices associated with cable television. However, households who have a lot of different subscriptions may find that, for the first time, they’re paying more.

Adapting to a Competitive Market
Streaming sites often find themselves competing against each other for the same target market. Increasing prices would normally be disastrous for any company in this position, especially when operating online. The streaming sector isn’t the only fiercely competitive market within the entertainment sector, either.

If you look at sites that provide casino games, you’ll notice that they also have a lot of competition, and offer a variety of incentives to try and keep customers loyal. Sites like Betfair offer prize pinball prize pinball for new players, as it allows them to offer free spins to returning gamers. Sportsbooks also offer free bets and promotions, as a way to draw punters to their online platform.

Even though streaming services face the same level of competition, they are taking a very different approach. Instead of giving back to their users, with free content, discount codes or bonuses, they’re hiking prices. In a competitive market you wouldn’t have thought would be a good strategy.

One thing that streaming companies are doing, in an attempt to soften the blow of steeper prices, is expanding into new markets and it looks to be paying off. Amazon and Netflix in particular are beginning to offer live sports to their users. Paying for sports through a streaming service is still far cheaper than paying for sports through cable TV, not to mention that it gives users the chance to watch individual matches without committing to a contract.

Price Hikes Aren’t Having an Immediate Impact on New Subscribers

Even though Netflix, Amazon, and even Spotify are hiking their prices, it’s not having an immediate impact on new subscribers. People are still signing up and growth doesn’t seem to be slowing down. Part of this could be due to the flexibility that streaming services offer. You can cancel any time, and you can also have multiple profiles on the same account. You can also access your account on the go, and you can customize it with an avatar and a username. With cable, you can’t do this, so it seems that the higher cost is justified by the additional functionality of the platform, at least for some. You also have access to exclusive shows, which also encourages people to sign up, regardless of the price hikes.

Even though the streaming market is fiercely competitive, it seems like the price hikes aren’t having a huge impact on user numbers. Another reason why this is the case could be because users are facing price hikes across the board. It’s hard to jump ship to another site when everyone is increasing prices. The market is very much syndicated and, with increased profit, streaming companies are investing in new content. For most people, this remains worth paying for.