Yahoo Finance Amazon Prime Video: Are streaming services worth the cost?
At historic moments in our collective history, we turn to live TV and radio, to find out exactly what’s happening at that moment, and feel the mood of the nation reflected.
However, as we have come to rely more and more on streaming services, this collective experience has become unusual.
Usually, we’re not just streaming something completely different from every other home on the street, but often from every other room in the house.
Streaming services were a real lifeline for many during the pandemic, but as we face the pressures of the rising cost of living and the price of these services is going up, it’s worth considering whether we are getting real value from them.
Price rises
Netflix (NFLX) has increased its prices twice since the start of 2021. Its most recent hike was in March, when the basic package (one screen and no HD) rose from £5.99 a month to £6.99.
Its standard package (two screens, HD and the ability to download) increased from £9.99 to £10.99, and the premium plan (four screens, HD and downloads) rose by £2 to £15.99.
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Disney+ (DIS) hiked prices from £5.99 a month or £59.99 a year to £7.99 or £79.90 in early 2021, and there are rumours of more changes coming in 2023.
On 15 September, the price of Amazon Prime (AMZN) is set to rise. The monthly cost will increase from £7.99 to £8.99, while the annual price will go up from £79 to £95.
Given how much pressure households are under, it’s no surprise that people are responding by cancelling.
Audience research data showed 800,000 UK households cancelled subscriptions to Netflix or Amazon Prime Video between April and June this year, and the number of households using at least one streaming service has dropped by 380,000 in that time.
However, if you’re attached to streaming services but will struggle with the price, there are ways to cut the cost.
Cut the cost
It may be tempting to cut corners by sharing passwords between households, but it’s against the user agreements, and as the streaming services see subscriber numbers dwindle you can be sure they’ll be clamping down on this.
There are a few options to pay less without breaking the rules.
In some cases, when these prices rise, if you can spare the annual fee in one lump sum, you can beat the rise by paying for a yearly subscription before it kicks in. It means Amazon Prime members can make a payment before 15 September, and lock in the cheaper rate.
Unfortunately, Netflix doesn’t offer an annual option, so you can’t use this technique when it hikes prices. And, of course, at the moment, finding this sort of lump sum isn’t always straightforward.
Another option is to trade down on Netflix. If you can compromise on how many people need to stream at once, then you can move to the basic package. If you move from premium to basic, you could save more than half the monthly cost.
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Keep your eyes peeled for special offers and free trials too. You can sign up for a single month and cancel when the trial ends, or sign up whenever there’s a good deal. Just make sure you cancel before you pay full price.
You can try to time these things for when a particular film you want to see starts streaming, or when a TV service has all the episodes of a particular show ready to download. That way you can binge watch them in a month and then cancel.
It’s also worth checking whether you can get streaming services bundled in with anything else you already pay for, at a lower cost.
This is something offered by some mobile networks — although as ever, it’s important not to pay for something you wouldn’t otherwise have bought because you’re tempted by the bells and whistles.
There’s another solution on the horizon too – which involves accepting adverts in return for a lower price.
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Now TV introducing adverts on its entertainment and cinema passes (costing £9.99 a month each). It also offered the Boost option, which allows streaming on more devices at the same time and removes the adverts for an extra cost of £5.
Netflix is expected to do a version of this in November, launching two tiers of service — with and without adverts — and Disney+ is expected to do the same sometime in 2023.
There’s the hope that you may be able to cut the current cost by accepting adverts. However, that’s not how it worked when Disney+ announced the change in the US. Instead, adverts were introduced at the current price, with the option to pay more to remove them.
How to work out if it’s worth cutting
Sometimes dropping a subscription service is the best approach, but if you have signed up to more than one, it can be difficult to work out which ones to cut.
One useful approach is to keep a diary for a couple of weeks. Just note down what you’re watching, and what services you’re using. This in itself might reveal things you’re paying for that are completely neglected.
If you’re not sure whether what you pay is worth it for what you get, divide the monthly cost in half to see what you paid for the fortnight, and then divide that by the number of hours you watched each streaming service. This approach will show you the "per hour cost" of each service, which can really help you weight up the value of each.
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Sarah Coles is a personal finance analyst at Hargreaves Lansdown and co-presents Switch Your Money On podcast.
