The "Global Household Media Survey Analysis" is a study prepared through a survey conducted in 10 different countries of Middle East, North America, Europe and Asia Pacific, on the penetration of different digital devices connected to internet and different subscription categories, as video on demand, music, gaming, news publishing and cloud services.
Smartwatches and voice assistant devices: the most popular gadgets
According to the study, households have in average 10 devices connected to the internet, even excluding computers. In this context, the region of Middle East leads the ranking, with an average of 14 connected devices per household, 33% more than Europe (10 devices), Australia (9) and North America (9), due to the Smartwatches penetration, where they lead with 30% more than other regions. In fact, 50% of United Arab Emirates households have a Smartwatch.
Also popular among the respondents are the voice assistant devices, which are in second place in terms of penetration, being North America the region and UK the country with the highest average number of voice assistance devices connected to the internet, with 38% and 43% of households claiming to have one, respectively. The fact that UK is the leading country in this category, positions Europe as the second region with higher number of households with at least one of these gadgets.
Percentage of households with at least one device connected to the internet
Subscriptions as a key driver for digital consumption
In the digital era context, having a subscription has become widespread. In this aspect, Middle East leads in all categories of subscription services, with a difference of 21% subscriptions per household in compares with North America, 26% with Australia and 28% with Europe. One of the main reasons of its position is the big difference with the other regions in Gaming subscriptions, where 62% of households have at least one subscription. Concretely, United Arab Emirates is ahead of Europe, North America and Australia in almost all the categories. However, Gaming penetration might likely be impacted by one-off purchases as well as subscriptions when answering the questionnaire.
Compared to the other regions, Europe has the lowest number of subscriptions per household, with an average of 4.9 subscriptions per person, being Spain the leading country in all categories. European households are less used to pay for media services, such as cable televisión, compared to North American’s, which translates into a lower number of subscriptions in VOD, the category that has the highest penetration in global terms. In addition, European national VOD services (‘BVOD’) are often advertising-based, except for the UK, where all the major broadcaster VODs offer a free service (ad-supported or publicly funded).
The greatest potential for subscription services is based on Middle East, ahead of Europe, North America and Australia, with an average of 75% of households expecting to increase their number of subscriptions, whereas North America is in the opposite position with only a 29%, mainly powered by participants from the USA. More concretely, in Saudi Arabia the 80% of households are expecting to acquire more subscriptions. As for Europe, Spain is the country with the highest potential for subscription services, with a 48% expecting to increase their number of subscriptions, and Germany the lowest, with only a 32%.
Percentage of households with at least one subscription
US households plan to increase subscriptions equally in video on demand and cloud storage; in Canada, respondents are expecting to increase mainly video subscriptions; UK is more interested in video and gaming subscriptions; and Australia had even spread across subscription categories. This growth potential will be led by households with higher than the average subscriptions, as they have greater propensity to add subscriptions versus the average.
In terms of age, and unlike with the devices connected to the internet where those under 25 have a lower percentage of ownership, this age group leads the growth of subscription services, as they are the most willing to multi-subscribe to digital services, with an average of 9.4 subscriptions per respondent globally, above the 8.6 subscriptions contracted by the 25-45 age group and the 4.6 of those over 45 years of age. This reflects how under-25s are the first movers in ‘shift to digital’ and subscriptions are a key aspect of digital consumption, thus we can expect average number of subscriptions to increase with the generational shift. In addition, it highlights the small difference between the age groups in Middle East, while in the other countries there is a huge gap from those under 45 to those over 45.
VOD is the subscription service with the highest number of users
The VOD market is positioned as the most mature of all the paid digital services analyzed in the study, with an average of 79% of households claiming to have at least one subscription. VOD’s popularity is creating a subscription ‘habit’, stimulating adoption for new types of media subscription, most recently podcasts.
Of all the regions surveyed, USA stands out above all, with an average of 4.7 paid video streaming platforms per household, ahead of Middle East (2.9), Europe (2.6), Canada (2.8) and Australia (2.6). 41% of the USA households claim to be subscribed to more than 5 SVOD services, a ratio far way above the rest of the regions. Nevertheless, in average of households with at least one subscription, USA is equal with United Arab Emirates, which, together with the other Middle East countries, makes the region of Middle East slightly ahead of North America in terms of VOD penetration. In addition, Spain is in 3rd position globally and first in Europe.
Although nowadays the video on demand market may appear to be saturated, with consolidated platforms losing subscribers and new platforms emerging and trying to find their place in a market led in all countries surveyed by the two main US platforms, except from Kuwait and Saudi Arabia where local platforms are in the top two in number of subscribers, with 13% and 17% of subscriptions respectively, it is expected to continue to grow, with respondents expressing a desire for more subscription video services.
Despite this leadership by the main global platforms (in all the countries surveyed more than 38% of households are subscribed to the top one, highlighting France with a 59% and Australia with a 54%), households with multiple services were interested in other services, especially locally focused. Concretely, in Germany video streaming is the subscription market, among music, gaming, cloud storage and news publishing, with the biggest potential for small companies, which share 15% of the market subscriptions; same situation than in Australia, where small platforms gather 16% of the subscriptions, just after the main platform with 54% of the market share.
The cloud storage subscription market is very similar in Europe, North America and Australia, with around 60% of the respondents subscribed to a cloud storage service. Nevertheless, Canada’s figure makes North America the last in the ranking, as 50% of the Canadian households do not have any cloud storage service hired, the lowest percentage of all countries analyzed.
In terms of market share, cloud storage is the most competitive market, as, although the market is split by the larger tech companies, there is a range of small players outside them fighting for a small share. Concretely, in Australia and North America, cloud storage is the subscription service, among VOD and audio streaming, with more balance in the market percentage share per each service, with the leader only reaching 29% and 25% of the subscriptions, respectively.
This market is expected to continue to increase with a greater penetration rate, as well as the consumer requiring larger packages and options, which still leaves the market even more open to small players.
Streaming audio and news subscriptions
Penetration of paid subscription services for audio is much lower in all the regions surveyed rather than for video-on-demand and cloud storage, as many respondents had no or only one audio subscription service.
However, all the countries analyzed have more than 50% of their households with at least one subscription to audio streaming, except for France and Germany. Like with VOD, Middle East is slightly ahead of North America in average number of households with at least one subscription, being United Arab Emirates and USA the countries with the highest figures.
The audio subscription market is also dominated by US companies, and only Middle East and France have a strong national player in audio subscription. In fact, in Kuwait and Saudi Arabia is the number one service in terms of subscribers, gathering 18% and 15% of the subscriptions, and in France is in the third position with a 10% of the market share, only 6 percentage points behind the player with more subscriptions.
Regarding news publishing, fewer households subscribe to a news publishing service rather than to video or audio. In the early days of online news, much of them were free to access, wich has led to an ongoing consumer unwillingness to pay for online news content.
On the other hand, the decline in print circulation continues and digital advertising revenues are insufficient, as each impression in digital channels is worth a fraction of the value to print consumers. News publishers are therefore focusing on increasing subscriptions and employing other payment models, including occasional payment, such as one-day subscriptions.