SEK 900 million streaming revenue lost in Sweden due to sharing

Thursday, August 31st, 2023 
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Mediavision: SEK 900 million (~$80m) in lost streaming revenue due to sharing

Sharing SVOD subscriptions is a widespread phenomenon. At the turn of the year, approximately 1.4 million SVOD accounts were used by people outside of the paying household. This has become a growing concern for streaming actors as it hampers growth. Several companies are now reviewing the possibilities of limiting sharing. Theoretically, those that share today could contribute to continued growth, if they were transformed to paying customers. If they would pay the same average price as everyone else, Mediavision estimates the value of today’s forgone revenues to approx SEK 900 million (excl. VAT) per year.

Potential Effect Of A Total Ban On Streaming Subscription Sharing - Sweden - 2Q 2023

In Sweden, close to 1.4 million SVOD subscriptions were shared outside the paying household at the turn of the year. Almost half of everyone with a SVOD subscription shares at least one subscription with someone outside the household. If sharing was stopped, the SVOD market could potentially grow up to 16 percent compared to today. The number of subscriptions would then increase from today’s 7.3 million to 8.7 million. Based on average household spend on stand-alone streaming subscriptions, the lost revenue is estimated to a value of close to SEK 900 million per year (excluding VAT).

Netflix was the first actor to take actions on account sharing, but Disney is also reviewing its sharing policy. For the companies, the hope is that this will accelerate growth, especially in households that have already shown interest in the services. But Mediavision’s analysis also points to risks. A ban on sharing may mean that some paying households actually leave the service all together.

“Almost half of all SVOD households in Sweden share at least one subscription outside the household, which shows how widespread the phenomenon is,” comments Marie Nilsson, CEO of Mediavision. “Many have made a habit of this and if the households are “forced” to prioritize, the risk of services being opted out increases. However, it is likely that all actors will review password sharing, which will possibly lead to both increased customer movement and more customers for the SVOD services.”

Links: Mediavision