Streaming overtakes pay-TV in Australia

Australia now has more people paying for streaming services, such as Netflix, Stan and Presto, than for conventional pay-TV, according to a new report from Roy Morgan Research.

The report found that there are 5,595,000 Australians paying for SVOD services, compared to 5,309,000 who have subscriptions to linear pay-TV offerings from companies such as Foxtel.

Another 629,000 people have an IPTV service such as Foxtel Play or Fetch TV. Many Australians have both pay-TV and one or more streaming services at the same time. The figures cover the six months until August 2016.

Netflix accounts for most of the streaming growth, while all the other services – including Stan, Presto, Quickflix, YouTube Red and Foxtel Play – are jointly found in the homes of around 1.4 million Australians. More than 60% of these subscribers are also paying for Netflix.

Despite the rise of SVOD, Foxtel’s linear pay-TV service is also growing by around 100,000 subscribers per quarter, bolstered by strong programming including HBO’s Game Of Thrones and Australian sports such as the AFL and NRL.

But Foxtel, a joint venture between Rupert Murdoch’s News Corp and Australian telco Telstra, is feeling the heat from Netflix and other streaming services. Under increasing pressure to compete, Foxtel CEO Peter Tonagh recently said the company is restructuring its IPTV service Foxtel Play, with a change in package options and lower prices.

Meanwhile, Australian press has reported that Foxtel’s joint venture partner in its SVOD service Presto, which ranks third behind Netflix and Stan, may be pulling out.

Foxtel is also planning to launch an Apple TV-style streaming device, which may carry Netflix. That would place it in direct competition with Telstra’s device Telstra TV, which streams Stan, Presto and catch-up services, further fuelling rumours that Telstra wants to reduce its stake in Foxtel via an IPO.