Streaming Services: Paid Options with Ads are Popular

Streaming Services: Paid with Ads Well-Received

More than one in five Germans now rely on at least one paid video streaming service with ad interruptions, according to analysis by the consulting firm Simon-Kucher. This firm has gathered several insights about the local streaming market in a new study. These developments are particularly noticeable with Netflix and Amazon Prime Video.

For streaming giant Netflix, the number of active ad subscriptions has tripled within a year. The study notes that this could also be due to increased pricing pressure. Disney+ also recorded a 14 percent share of ad subscribers.

Globally, the study’s authors found that Netflix has at least partially cannibalized itself by introducing ad subscriptions. The proportion of users switching from a more expensive ad-free subscription to a cheaper ad-supported one has increased from 42 to 46 percent. However, this effect is declining for Disney+.

77 Percent Pay for Ad-Free Prime

Amazon Prime, on the other hand, benefits in two ways. First, the online retailer now deploys ads to its Prime Video customers by default. Second, additional fees are collected from customers who actively choose to continue with an ad-free streaming option. According to the study’s findings, a substantial 77 percent of Prime customers pay for the relatively new ad-free option.

An interesting aspect of the study is the impact of the manner of ad placements on user acceptance. Users indicate that they prefer when the remaining duration of the ad interruption is displayed. Moreover, pre-stream ads, which are shown before the actual content starts, are perceived as less disruptive by most users.

Streaming Budget of €23

Another factor supporting the growth of ad subscriptions is the introduction of account sharing restrictions. The percentage of users who share accounts has dropped to 20 percent. Almost half of those affected by these restrictions are willing to take out their own subscription. Ad subscriptions offer a cost-effective entry point here.


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