While there is a huge shift in progress among audiences opting for OTT platforms like Netflix and Prime Video, there is an emerging trend among the viewers that is arousing great concern for these entertainment powerhouses.
Many subscribers leave the platform after binge-watching their favorite shows and cancel their subscriptions. This trend, also called the subscription churn is a huge threat to online platforms and the rate with which it is increasing only adds insult to injury.
The number of OTT service users that cancel or allow their subscriptions to expire is referred to as the churn rate. This might be done voluntarily or not. When customers purposefully terminate their memberships, such as after finishing the series they paid up to watch, this is known as voluntary churn. When customers inadvertently cancel their memberships, it’s known as involuntary churn. This is sometimes the result of problems like refused transactions or expired payment methods.
As it gauges the number of users who leave a streaming service within a given time frame, it’s an essential metric for any platform. For streaming companies, subscription churn is a constant worry, with churn rates of 30–40% monthly becoming the norm.
A prime example of such a trend was seen in July after the third season of Mirzapur was released. Many Prime Video subscribers took up the subscription but didn’t renew it after watching the show. Another incident can be seen with Netflix. A spike in Netflix subscriptions might occur when well-known series like Bridgerton or The Squid Game get released. However, these subscribers could stop after seeing their preferred shows and cancel their subscriptions.