Hybrid ad-supported services to drive SVOD growth

Despite signs of a slowdown, global SVOD subscriptions are predicted to increase by 428 million between 2022 and 2028 to reach 1.76 billion by Digital TV Research, driven by ad-supported tiers.

Growth will largely be driven by the emergence of hybrid SVOD-AVOD tiers, including from Netflix, Disney, Warner Bros. Discovery and Paramount, according to the research outfit.

Simon Murray, Principal Analyst at Digital TV Research, said: “We estimate that Netflix will provide its hybrid AVOD-SVOD tier in 85 countries by 2028, with Disney+ in 91 countries, HBO in 55 and Paramount+ in 56. These include pan-regional services in Spanish-speaking Latin America and also in the Arabic-speaking countries.”

These four platforms collectively will have 372 million hybrid AVOD-SVOD subscribers by 2028 – or 56% of their total subscriber base – according to Digital TV Research.

Given that Disney+ subscribers in most markets are expected to convert automatically to the hybrid AVOD-SVOD tier, Digital TV Research predicts that the platform will have 206 million subs to this tier by 2028 – or 88% of its total. At the other end of the scale, only 24% of Netflix’s total subscribers will pay for the hybrid AVOD-SVOD tier by 2028 – or 63 million.

Murray said: “Netflix has a large base of SVOD-only subscribers. Most of these subscribers will remain on these plans, despite the AVOD-SVOD tier being considerably cheaper. The hybrid tier will appeal most to developing countries where disposable incomes are lower. The hybrid tier will also be attractive to new subscribers that do not have legacy SVOD-only subscriptions.”