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More Canadians ditch traditional TV as streamers are 'winning the battle'

A recent report highlights a noticeable shift in how Canadians watch television, with more people turning to streaming services instead of traditional cable or satellite subscriptions. This change comes as authorities mull over new regulations to ensure fair competition in the industry.

According to the annual Couch Potato Report released by Convergence Research, almost half of Canadian households had forsaken traditional TV subscriptions by the end of last year. The trend is expected to continue, with projections suggesting that by 2026, half of all households will have moved away from conventional TV.

In contrast, streaming services are experiencing a surge in popularity, with over 80 percent of Canadian households now subscribed to at least one streaming platform. Additionally, 70 percent of households have both traditional TV and streaming service subscriptions.

Last year, 2.6 percent of Canadian TV subscribers decided to "cut the cord," contributing to a three percent decline in revenue for traditional TV providers, which amounted to $7.2 billion. Conversely, Canadian streaming services saw a 14 percent increase in subscription revenue in 2023, reaching $3.73 billion, with forecasts predicting a further rise to $4.24 billion this year.

Brahm Eiley, president of Convergence Research, emphasized the dominance of streaming platforms, attributing their success to substantial investments in content. He stated that companies like Netflix, Amazon, and Apple are "winning the battle" due to their robust content offerings.

Despite a 12 percent increase in the average price of streaming services last year, many Canadians are still drawn to these platforms, particularly those offering ad-supported packages. These packages, which require viewers to watch advertisements, were found to be 42 percent cheaper on average than ad-free alternatives.

On average, Canadian households subscribe to 2.5 streaming platforms, indicating a growing preference for varied content options. However, unlike in the United States, where traditional TV subscriptions are rapidly declining, Canada's transition to streaming platforms is occurring at a slower pace, partly due to steady population growth driven by immigration.

Nevertheless, Canada's broadcasting sector faces significant challenges, prompting calls for regulatory reform. The Canadian Radio-television and Telecommunications Commission (CRTC) recently held hearings to modernize the regulatory framework for broadcasters, in response to the Online Streaming Act.

The CRTC is considering whether foreign streaming services should contribute to promoting Canadian content, a move supported by major Canadian broadcasters and telecom giants. However, streamers like Netflix argue against such contributions, citing their existing support for Canada's broadcasting industry.

As the CRTC aims to finalize its new regulatory framework by the end of the year, the popularity of streaming services continues to grow. Eiley noted the diverse range of streaming options available to Canadians, catering to various interests and preferences beyond just mainstream content providers.