Netflix takes The Crown

It’s now official. In the latest BARB data for Q1 2018, in terms of the number of subscribing households, Netflix is now the largest paid for TV provider in the UK, knocking Sky off it’s throne that it has sat on for over 30 years.

Its been called a disruptor, a new entrant, a protagonist, but there is now no escaping that Netflix is mainstream and availability alone, the largest player in town.

SkyvsNetflix

Netflix in the first three months of 2018 saw its largest increase in subscribing households since BARB began measuring, with nearly 1m new households taking up the service early this year. It is now estimated that 9.1m households in the UK are subscribing to Netflix. That’s a 12% increase in just a single quarter.

SVOD Numbers

It’s not just Netflix that has performed well in Q1 of course, Amazon Video also continues to increase it’s footprint, with an increase of 0.6m households in the quarter, a quarterly growth of 13%, in line with that of Netflix.  Alongside these double digit increases however, Now TV experienced a relatively sluggish Q1 remaining relatively unchanged on Q4 2017.

Although these are no doubt disappointing numbers for Now TV, underlying this is a yearly growth that does indeed outpace it’s rivals (albeit from a much lower base).  Comparing Q1 figures year on year, Now TV has seen a 38% uplift in subscribers, above that of Netflix (31%) and Amazon Video (35%).  So, it’s possibly too early to tell whether this quarter is simply a blip or a slowdown in general.

SVOD Annual Growth

So, what does all this mean to the average household in the UK. Well, as already mentioned, Netflix is now the leading distributor of paid television in the UK, with 32% of all households in the UK paying for Netflix. This is followed by Amazon Video which is in 17% of homes, and Now TV in 5%.  Overall, 39% of all homes have access to at least one SVOD service, and if this rate of growth continues, this may get close to 50% by the end of 2018.

SVOD Penetration

This data highlights an interesting question of course, the UK has always had a traditional free to air cohort of homes of around 10-11m. We’ve seen in previous analyses from BARB that SVOD subscribers skew heavily towards pay-tv so potentially the biggest disruption of these services will be if they take hold in homes that have otherwise previously been reluctant to pay for television, and given the growth above, that looks like it’s already happening.  If Netflix, and Amazon can convert those types of households to embrace paying for access, then they truly are a game changer. Interesting times ahead for sure.