Attention recession impacts on D2C growth

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20,000 foot view:  Weekly active user (WAU) penetration for the top streaming services is now slowing with quarter-on-quarter growth effectively flat for the leading subscription video on demand (SVOD) services. Peak attention is now clearly here for video. The looming attention recession, which is already impacting the wider digital entertainment landscape, will exacerbate the greater underlying disengagement trends such as cancelling subscriptions that are starting to impact on video. Average weekly hours for SVOD are marginally down from        hours in        2021 to        hours in        2022. Nonetheless, the increasing moves to add an entry-level ad tier to SVOD services are likely to also increase cancellations from the        of consumers who skip ads. WAUs can thus be expected to decline in        2022 as subscribers disengage with both their attention and their wallets.

Key insights 

• As the attention recession plays out, multiple video subscriptions continue to climb.        of consumers now have one or more SVOD subscriptions, compared to        as of        2021
• Consumers are now approaching saturation with WAU penetration for the leading SVOD services slowing
• Netflix        Amazon Prime Video        and Disney+        are all up marginally between        2021 and        2022 while Apple TV+ remains flat at        WAU penetration
       strategy is evolving to offset cost-of-living impacts with Disney announcing in        2022 that they will be introducing an ad-supported tier to Disney+, and Netflix is rumoured to be considering doing the same
• Ad-supported tiers will face significant resistance as        of consumers usually skip video ads online in        2022, up by        from        2021
• YouTube remains the most used video platform by video subscribers – of those who have more than one video subscription,        also use YouTube on a weekly basis
• Netflix is still the most popular SVOD service across SVOD WAUs, with        of all video subscribers being a Netflix WAU, despite experiencing two consecutive quarters of subscriber decline in        2022

Companies and brands mentioned in this report: Amazon Prime Video, Apple TV+, Disney+, ESPN+, Facebook Video, Formula        HBO Max, Hulu, Meta, Netflix, Paramount+, Spotify, Snap, Pluto Tv, Tubi, and YouTube