More and more Canadians are switching from traditional television to streaming services, suggests a new report released as the federal telecommunications regulator considers imposing new rules to help level the playing field. game in this sector.
In its annual report entitled “Couch Potato”, released Monday, the research group Convergence reveals that 42% of Canadian households did not have a television subscription with a traditional provider at the end of last year. It predicts that by the end of 2026, half of households will no longer watch traditional television.
Meanwhile, the report indicates that more than 80% of Canadian households subscribe to a streaming service, while 70% of households subscribe to both television and at least one streaming platform.
Last year, 2.6% of television subscribers terminated their contracts, contributing to the fact that revenues generated by television providers fell 3% to $7.2 billion — a trend which, according to the report, will continue until 2026.
Meanwhile, streaming platform revenues from Canadian subscriptions grew 14% in 2023 to $3.73 billion. They should reach $4.25 billion this year.
“It is certain that platforms like Netflix, Amazon or Apple are and will continue to be the alternative option for people who want to unsubscribe from traditional television,” underlined the president of the Convergence group, Brahm Eiley.
“They are the ones that the content is moving towards, they are the ones that attract the big investments. Ultimately, they are winning the battle. »
Streaming services continued to gain ground last year in Canada, although their prices increased by an average of 12%, when taking into account the 10 most popular platforms.
Mr. Eiley noted that it is not surprising to see the popularity of streaming growing, noting that there are dozens of options available to Canadians, when taking into account the many small services that offer more niche programming.
“We shouldn’t just think about the big players, there are plenty of platforms that specialize in a certain sector: sport, horror, films… there’s everything,” he recalled.
Less pronounced than in the United States
Last year, several platforms added a package with advertisements to their offering, cheaper than their other packages. Canadians found they were able to make “significant” savings thanks to these ad-supported packages, the report says. On average, plans with ads cost 42% less.
Furthermore, households that rely on streaming services pay on average for 2.5 platforms per household.
The research group estimates that only four in 10 Canadian households had a subscription to a TV provider at the end of 2023 — a figure it predicts will decline to a quarter by 2026.
According to Mr. Eiley, the abandonment of traditional television in favor of streaming platforms is nevertheless occurring less quickly in Canada than in the United States.
He added that immigration is one of the reasons the decline has been less pronounced in Canada.
“It really made sure that everything didn’t fall apart for television yet,” he said.
The CRTC questioned
In the wake of the difficulties experienced by Canadian media and the greater space occupied by streaming services, the Canadian Radio-television and Telecommunications Commission (CRTC) was called upon to intervene quickly.
The federal telecommunications regulator held a 15-day hearing late last year focused on modernizing the regulatory framework for broadcasters.
These hearings were held on the sidelines of a broader public consultation which followed the adoption of the Online Streaming Act, which received royal assent last April. This law aims to update federal legislation to require digital platforms to contribute and promote Canadian content.
One of the options studied by the CRTC is to require foreign broadcasters to make an initial contribution to the Canadian content system. The regulator argued that this could create a better balance between streaming platforms and Canadian media, which already have obligations regarding Canadian content.
Major Canadian broadcasters, such as Rogers, Bell, Telus and Quebecor, had urged the CRTC to modify the regulatory framework to take into account subscribers and revenues transferred to foreign streaming services.
For their part, the large platforms strongly encouraged the federal regulator not to impose such conditions. Netflix, for example, argued that the CRTC should recognize the role it already plays in funding the Canadian broadcast industry and reject calls to require it to make additional payment.
The CRTC aims to draft and implement its new regulatory framework by the end of this year.