40% of Consumers Likely To Cancel a ‘Costly’ Online Subscription: Survey

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

40% of Consumers Likely To Cancel a ‘Costly’ Online Subscription: Survey

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For years, online streaming services lured consumers as cheaper options to watch TV or listen to music. But a new survey suggests that many Americans will likely ditch a digital service this year because it’s too expensive.

Cost is the top reason why Americans are likely to cancel an online subscription for movies, music, news or other apps, according to a new survey commissioned by Los Angeles-based tech consultancy Concepts Rise. The findings come amid an increasingly crowded and competitive market for digital subscriptions, as well as the higher consumer prices Americans are now paying due to inflation.


In a survey of 1,054 U.S. adults conducted in mid-February, 40% said they are either “very likely” or “somewhat likely” to cancel a paid subscription this year. Of that group, 43% said they would likely do so because the services are “too costly.” Other reasons included wanting to consolidate services (20%), the end of a promotional discount (18%) and a lack of quality media (13%).

Those figures could give pause to the likes of Netflix, which recently raised prices by as much as $2 per month for its video subscription plans. But Majid Abai, founder and CEO of Concepts Rise, said the streaming giant can probably get away with higher rates because of its superior user experience and pipeline of fresh content. It is “second-tier” rivals, with poorer navigation features and less new content on offer, who should be more hesitant about raising prices, he added.

“[Netflix is] definitely leading the pack on that standpoint, and therefore they get to raise the price,” Abai said of the company’s content offerings. “I think it's a big risk if the secondary tiers decided to [raise prices].”

Both Netflix and Spotify spooked investors earlier this year after each forecasted slowdowns in their subscriber growth this quarter. While it’s uncertain whether those low estimates are mere road bumps or harbingers of long-term decline, Abai said media companies must focus on retaining customers as their platforms mature and new subscription growth slows. He compared the digital subscription model to that of software-as-a-service (SaaS) firms, which often go through growth patterns but ultimately need to retain customers.

“Now it becomes a balancing act of really continuing to grow and reducing churn on the other side,” he said of streaming services.

Concepts Rise’s data indicates that consumers are still willing to sign up for a new service—if the price is right and the content is broad. When all survey participants were asked what would motivate them to subscribe to an online service, most of them (58%) said better pricing, followed by broader product offerings (22%).

The survey’s findings are consistent with other new data on video streaming habits. Subscription analytics firm Antenna released data last week showing that more consumers opted for cheaper, ad-supported subscriptions in 2021 than in previous years. Ad-supported plans accounted for 32% of all premium subscription video on demand sign-ups last year, compared to just 19% in 2020, Antenna said.

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LA Latino/a Founders On Why Authenticity Matters in Tech

Decerry Donato

Decerry Donato is a reporter at dot.LA. Prior to that, she was an editorial fellow at the company. Decerry received her bachelor's degree in literary journalism from the University of California, Irvine. She continues to write stories to inform the community about issues or events that take place in the L.A. area. On the weekends, she can be found hiking in the Angeles National forest or sifting through racks at your local thrift store.

LA Latino/a Founders On Why Authenticity Matters in Tech
Decerry Donato

As one of the most diverse cities in the world, Los Angeles is home to almost 5 million people who identify as Hispanic or Latinx. Yet, many feel they still lack representation in the city’s tech space.

“I can safely say that last year’s LA tech week hosted all of the events on the west side, and very few were focused on telling Latino and Latina entrepreneurial stories,” said Valeria Martinez, investor at VamosVentures. “We wanted to change that this year.”

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LA Tech Week Day 3: Social Highlights
Evan Xie

L.A. Tech Week has brought venture capitalists, founders and entrepreneurs from around the world to the California coast. With so many tech nerds in one place, it's easy to laugh, joke and reminisce about the future of tech in SoCal.

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LA Tech Week: Female Founders Provide Insights Into Their Startup Journeys

Decerry Donato

Decerry Donato is a reporter at dot.LA. Prior to that, she was an editorial fellow at the company. Decerry received her bachelor's degree in literary journalism from the University of California, Irvine. She continues to write stories to inform the community about issues or events that take place in the L.A. area. On the weekends, she can be found hiking in the Angeles National forest or sifting through racks at your local thrift store.

LA Tech Week: Female Founders Provide Insights Into Their Startup Journeys
Decerry Donato

Women remain a minority among startup founders. According to Pitchbook, even though women-led startups in the United States received a record $20.8 billion in funding during the first half of 2022, U.S. companies with one or more female founders received less than 20% of total venture funding in 2022. U.S. companies solely led by female founders received less than 2% of the total funding.

The panel, titled Female Founders: Planning, Pivoting, Profiting, was moderated by NYU law professor Shivani Honwad and featured Anjali Kundra, co-founder of bar inventory software Partender; Montré Moore, co-founder of the Black-owned beauty startup AMP Beauty LA; Mia Pokriefka, co-founder and CEO of the interactive social media tool Huxly; and Sunny Wu, founder and CEO of fashion company LE ORA.

The panelists shared their advice and insights on starting and growing a business as a woman. They all acknowledged feeling pressure to not appear weak among peers, especially as a female founder. But this added weight only causes more stress that may lead to burnout.

“The mental health aspect of being a founder should not be overshadowed,” said Kundra, who realized this during the early stages of building her company with her brother..

Growing up in Silicon Valley, Kundra was surrounded by the startup culture where, “everyone is crushing it!” But she said that no one really opened up about the challenges of starting your own company. .

“Once you grow up as a founder in that environment, it's pretty toxic,” Kundra said. “I felt like I really wanted to be open and be able to go to our investors and tell them about challenges because businesses go up and down, markets go up and down and no company is perfect.”

Honwad, who advocates for women’s rights, emphasized the value of aligning yourself with people with similar values in the tech ecosystem. “[Those people] can make your life better not just from an investment and money standpoint, but also a personal standpoint, because life happens,” she said.

Moore, who unexpectedly lost one of her co-founders at AMP Beauty, said that entrepreneurs “really have to learn how to adapt to [their] circumstances.”

“She was young, healthy, vibrant and we've been sorority sisters and friends over the past decade,” she said about her co-founder Phyllicia Phillips, who passed away in February. “So it was just one of those moments where you have to take a pause.”

Moore said this experience forced her to ask for help, which many founders hesitate to do. She encouraged the audience to try and share their issues out loud with their teams because there are always people who will offer help. When Moore shared her concerns with her investors, they jumped in to support her in ways she didn’t think was possible.

Kundra said that while it is important to have a support group and listen to mentors, it is very important for entrepreneurs to follow their own thinking and pick and choose what they want to implement within their strategy. “At the end of the day, you really have to own your own decisions,” she said.

Kundra also said that while it is easy to turn to your colleagues and competitors and do what they are doing, you shouldn’t always follow them because every business is different.

“When I was in the heat of it, I kind of became [a part of] this echo chamber and that was really challenging for us,” Kundra added, “but we were able to move beyond it and figure out what worked for us [as a company] and we're still on a journey. You're always going to be figuring it out, so just know you're not alone.”

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