The number of UK subscribers for television streaming services has overtaken traditional pay television for the first time, reports British communications regulator Ofcom.
The total number of UK subscriptions to the three most popular online streaming services – Netflix, Amazon Prime and Sky’s Now TV – reached 15.4 million in Q1 2018, surpassing the number of pay-TV subscriptions at 15.1 million.
This move marks a “major shift in the UK’s viewing habits,” according to Ofcom’s Media Nations report, a comprehensive study of major trends in the UK’s television, radio and audio sectors, published Wednesday (July 18).
Ofcom research also concluded that the amount of revenue generated from pay-TV has fallen for the first time (2.7%), after a period of sustained growth. Despite the decline, pay-TV revenue (£6.4/US$8.35 billion) still brings in more change than revenue generated by SVOD subscriptions (£895 million/$US1.167 billion).
Spending by the BBC, ITV, Channel 4 and Channel 5 on new UK-made television programs, meanwhile, fell to a 20-year low as UK audiences are spending less time watching television – falling by nine minutes in 2017, and down 38 minutes since 2012.
The report also notes that with the rise of major global internet companies, as well as changing habits and preferences of UK audiences, broadcasters are battling for “viewers in an increasingly fragmented landscape.”
“Today’s research finds that what we watch and how we watch it are changing rapidly, which has profound implications for UK television,” said Sharon White, Ofcom’s chief executive, in a statement. “We have seen a decline in revenues for pay-TV, a fall in spending on new programs by our public service broadcasters, and the growth of global video streaming giants. These challenges cannot be underestimated.”
On a positive note, viewers’ confidence in public service broadcasting remains steadfast, with 75% of those watching the channels saying they are satisfied, and 84% consider news programming from the UK’s pubcasters to be its most important content.
This finding reinforces Ofcom’s call earlier this year for UK broadcasters to team together to compete against online competitors’ expansion. The comms regulator expects that pubcasters will find new ways to distribute programs, connect with younger audiences, and produce content that reflects UK life as a means to adapt in the digital age.
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