Even though PYMNTS Intelligence’s “How the World Does Digital” report, which examines the digital behaviors of more than 817 million consumers across 11 countries, along with recent industry trends and Netflix’s earnings, paint a clear picture of streaming’s growing supremacy,  a plot twist emerged over the weekend from AMC Entertainment and Cinemark Holdings: Moviegoing is staging an unexpected and impressive comeback.

AMC Entertainment set new records for both attendance and admissions revenue during the weekend of July 26-28, 2024, reporting an influx of more than 6 million moviegoers across its AMC Theatres in the U.S. and Odeon Cinemas worldwide.

The standout performer was Disney and Marvel’s “Deadpool & Wolverine,” which not only set industry records for an opening weekend for an R-rated film, but also established new AMC benchmarks for attendance and revenue in this category. The film earned a reported $205 million domestically.

In addition to box office success, AMC reported its highest food and beverage revenue weekend since 2019, driven by record sales at its MacGuffins bars. Merchandise for “Deadpool & Wolverine” also sold out, becoming AMC’s top merchandise program of the year and second highest in the company’s history, behind only the “Taylor Swift: The Eras Tour”  concert film.

AMC Chairman and CEO Adam Aron noted the significance of these records, saying, “The weekend’s achievements underscore the strong return of cinema and our successful collaborations with studios and filmmakers.”

Meanwhile, Cinemark Holdings achieved its highest-ever domestic box office for a summer opening weekend with the release of “Deadpool & Wolverine.” The film set records for both Cinemark XD and D-BOX motion seats, reflecting strong demand for immersive cinema experiences. It also led to the highest concessions revenue Cinemark has seen since the pandemic, driven by robust sales of snacks and merchandise.

Cinemark President and CEO Sean Gamble praised the film’s impact, noting its role in elevating the moviegoing experience and demonstrating the cinema industry’s resilience.

“Building upon strong box office momentum over the past two months, Disney and Marvel’s highly anticipated superhero adventure, “Deadpool & Wolverine,” just took theatrical moviegoing to a new stratosphere,” Gamble stated. “We are thrilled to share that ‘Deadpool & Wolverine’ drove Cinemark’s biggest summer opening weekend of all time, generated record-breaking results in premium formats, and delivered our highest weekend of concession revenues since the pandemic.”

Looking ahead, Cinemark anticipates continued success with upcoming releases including “It Ends with Us,” “Borderlands,” and “Joker: Folie à Deux.”

The “How the World Does Digital” report offers a comprehensive analysis of digital engagement across 11 countries, providing a snapshot of a rapidly evolving global digital landscape. Drawing on insights from nearly 60,000 consumers, the report delves into how digital infrastructure, generational shifts, and economic factors influence digital behaviors worldwide.

Covering a range of regions including the U.S., U.K., and five major EU countries—France, Germany, Italy, the Netherlands and Spain — as well as Brazil, Japan, and Singapore, the report encompasses a population statistically representative of about 800 million people. It evaluates digital activities across 40 categories, including work, lifestyle, payments, shopping, dining, health, entertainment, communication, travel and banking.

Video streaming was the No. 1 digital activity in seven of the 11 countries surveyed; Singapore’s was music streaming; Italy’s was messaging; the Netherlands was mobile banking; and messaging earned the top spot in Japan. Of the four countries that didn’t list video streaming No. 1, it was No. 2 for three of them, with watching a livestream No. 2 in Japan.  

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The streaming giant posted a 17% surge in revenue to $9.56 billion, buoyed by a 16% year-over-year uptick in average paid memberships, with an operating margin of 27%, up from 22% in Q2 2023.

As the leading premium streaming service, Netflix expanded its global subscriber base to 277.65 million in Q2, adding 8.05 million net paid customers. The company reported a net income of $2.15 billion, up from $1.49 billion a year ago.

Netflix introduced a new, user-friendly TV homepage in June to enhance content discovery. Progress in scaling the ad business includes a 34% growth in ad tier memberships. The company is developing an in-house ad tech platform scheduled for testing in Canada in 2024 and a broader launch in 2025.

“We’re pleased with our performance in Q2, there was a strong performance across the board, good momentum across the business, strong revenue growth, member growth, and profit growth,” Netflix CFO Spencer Neumann said during the earnings call. “We’re targeting 26% full-year income margin, up five percentage points year over year. We’re committed to growing margins each year.”

Key initiatives include enhancing user experience and content offerings to better serve members. Q2 featured popular series like “Bridgerton S3,” “Baby Reindeer,” “Queen of Tears,” and “The Great Indian Kapil Show,” alongside hit films such as “Under Paris,” “Atlas and Hit Man,” and “The Roast of Tom Brady,” attracting record live audiences.

Netflix introduced its ad-supported tier in late 2022 and has incrementally revealed its performance metrics. Advertising now plays a pivotal role in enhancing streaming profitability, bolstering Netflix’s stock amid initiatives to grow its ad-supported subscriber base and mitigate password sharing.

The inclusion of live sports events, such as NFL games on Christmas Day, is designed to further increase ad revenue. Despite reaching about 270 million global subscribers by Q1, Netflix is pivoting its focus from growth metrics to emphasize revenue and operating margin, signaling a strategic shift toward greater profitability.

“We’re very pleased with how we’re scaling our ads business,” Neumann said. “The revenue portion of ads is growing nicely.”

Neumann said it will take time to scale the ads business, but it should be more of a prominent revenue driver by 2026, adding, “We’re scaling well through reach, through engagement, through growing inventory and that represents opportunity for us over a multiyear trajectory to have a big and increasing revenue and profit impact on the business.”

Looking ahead, Netflix officials anticipate a 14% year-over-year increase in revenue for Q3, and for the full year 2024, they forecast a range of 14% to 15%, up from previous estimates of 13% to 15%.

“This adjustment reflects strong membership growth trends and positive business momentum, partially offset by the U.S. dollar’s strength relative to other currencies,” according to the shareholder letter.

Co-CEO Greg Peters noted that improving the overall member experience is an ongoing process at Netflix.

“So, we’re constantly prioritizing all those opportunities based on what we think is the expected value,” he said. “To give you a sense of how wide that is, even things that we’ve been working on for over a decade, like our signup flows, the user experience that a consumer has when they want to sign up for Netflix, we have found multiple improvements just over the last couple of quarters in those flows which have delivered material incremental revenue wins.”

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The model will also allow listeners to access more storytelling, the company said in a Thursday (July 11) blog post on its website.

In the new model, titles in all Audible’s membership offerings can earn royalties, according to the post. That means small publishers and independent authors will be able to earn across all membership listening activity; titles in the company’s all-you-can-listen offering, Audible Plus, can generate royalty payments; and publishers and creators can monetize and promote content in new ways.

In addition, the new business model will provide additional insights to publishers and creators, the post said. Providers who sign up for the new model will get monthly statements and royalty payments that support timely decision-making, as well as additional insights about the impact of listening on their earnings.

To calculate the new royalty model, Audible takes a member’s plan value, adds the value of any additional credits used, and then divides that value among the titles the member listened to during the month, per the post. That figure is then multiplied by the contractual royalty rate to determine the creator’s royalty payment, per the post.

“Audible is a home for creators, and we are focused on both existing and emerging voices — working hand in hand with them to make sure their content is reaching the right audiences,” Rachel Ghiazza, chief content officer at Audible, said in the release.

This new royalty model arrives at a time when competitive offerings from companies like Spotify and Everand are directly challenging established leaders like Audible, which has long dominated the audiobook market with its subscription-based service.

Both Spotify and Everand present compelling alternatives with their extensive libraries and integrated platform experiences, PYMNTS reported in March.

In November, Spotify announced the addition of more than 200,000 audiobooks for its Premium subscribers, with 15 hours of listening included in the subscription per month before consumers have to start paying extra for the content.

Spotify said at the time that it found that 72% of Generation Z and millennial consumers listen to audiobooks.

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Wondery will exclusively distribute and sell ads for the podcast, co-produce two new podcasts, offer a livestream of the show each year, and get a first-look option for any new podcasts Shepard creates, The Wall Street Journal (WSJ) reported Thursday (July 11).

In addition, Amazon will launch new video episodes of “Armchair Expert,” distribute translated versions of the podcast globally, and distribute and sell ads for the podcast’s 600-episode back catalog, according to the report.

Members of the Wondery+ subscription service will be able to access new episodes of the podcast a week before they are distributed to other platforms, the report said. They will also receive the podcast ad-free.

The podcast will move to the Wondery platform from Spotify, per the report.

Wondery CEO Jen Sargent told Variety in a report posted Thursday: “‘Armchair Expert’ consistently delivers relatable, thought-provoking and entertaining social commentary based on shared human experiences and interests from the most recognizable entertainment and cultural figures in the world. This incredible show is a natural fit for the Wondery roster built to entertain, engage and delight podcast fans globally.”

The podcast’s guests have included Barack Obama, Prince Harry, Hillary Clinton, Trevor Noah, Stacey Abrams, Bill Gates, Dr. Sanjay Gupta, Jason Bateman and Kristen Bell (who is married to Shepard), according to the Variety report.

Shepard told Variety: “The Wondery logo actually means something. They are the HBO of the podcast space. We are extremely excited to join forces and bring fresh new content to listeners around the world.”

Amazon purchased Wondery in December 2020, saying that in partnership with Amazon Music, Wondery would “be able to provide even more high-quality, innovative content and continue their mission of bringing a world of entertainment and knowledge to their audiences, wherever they listen.”

The eCommerce giant’s music streaming service had begun offering podcasts about two months earlier. The idea behind the acquisition of Wondery was to expand what Amazon Music offers to include more podcasts as that format was continuing to gain in popularity.

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That’s according to a Wednesday (July 10) report by The Wall Street Journal (WSJ), which notes the move comes as the company is looking to become less reliant on its TV channel.

The report cites a memo from CEO Mark Thompson to employees which says CNN’s television newsgathering and digital-news divisions would be combined as the company places a greater emphasis on its digital expansion.

“We recognize its potentially enormous impact on the individuals affected,” Thompson said in an interview with the WSJ.

CNN, which has more than 3,500 employees, said the cuts would take place throughout the company. Thompson’s memo said the network was creating a billion-dollar-plus digital business. He declined to offer the WSJ specifics about the coming digital-subscription service but said it would “be significantly built out of CNN.com.”

Reports of the planned subscription service first emerged in January, when Thompson outlined plans to combine the network’s TV, streaming and digital presence.

As PYMNTS wrote at the time, these changes are happening as consumers’ media diets are moving away from traditional cable, with consumers canceling their cable and pay TV subscriptions by the millions every year.

“Cord cutting started in 2008 — right around the time of the Great Recession — and slowly gained a head of steam as millennials, mostly, gravitated to the streaming content that they could access on their laptops or connected TVs — and soon thereafter, their smartphones,” PYMNTS’ Karen Webster wrote last fall.

 “Netflix and specialty websites filled the news and entertainment content gap with better content delivered via new and cheaper business models. The ranks of the cord cutters rose.”

As that report also noted, CNN does have a somewhat spotty track record with subscription models. In 2022, the short-lived CNN+ shut down one month after launching in the wake of WarnerMedia and Discovery’s merger.

And in times of economic distress, consumers aren’t keen on adding more digital media subscriptions. The report “The One-Stop Bill Pay Playbook: Drivers of Consumers’ Bill Payment Priorities,” a PYMNTS Intelligence and Mastercard collaboration, found that only 22% would prioritize paying their digital media subscription bills in full above others. Meanwhile, 20% would skip payment on their digital media bills until they could afford it, 20% would pay just a portion of the bill and 38% would cancel the service.

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Social media users in Canada and the United Kingdom have been posting that they received notifications from Netflix that the company’s Basic plan has been discontinued, and they must choose an ad-supported tier or a more expensive ad-free one, The Verge reported Tuesday (July 2).

Asked about the notifications by The Verge, Netflix pointed to a statement made during the streaming provider’s January earnings call: “The ads plan now accounts for 40% of all Netflix sign-ups in our ads markets, and we’re looking to retire our Basic plan in some of our ads countries, starting with Canada and the U.K. in Q2 and taking it from there.”

Netflix discontinued its Basic plan for new or returning members in the United States, Canada and the U.K. in 2023, according to the report.

The company has not said when it will phase out the plan for existing subscribers in the U.S., the report said.

Netflix said in April that subscriber fees and its burgeoning ad business had boosted its operating income by 54% to hit $2.6 billion in the first quarter. The firm also added 9.3 million paid subscribers during the quarter, bringing its total number to nearly 270 million globally.

The streaming provider launched its foray into ad-support plans in 2022 and has since seen advertisers invest in campaigns designed to resonate with the platform’s viewers.

“Our two priorities in ads are to scale our member base and to build out our capabilities for advertisers,” Netflix said at the time in a shareholder letter. “We made progress on both fronts in Q1.”

Netflix is not alone in making changes like these. Streaming services providers are looking to drive revenue per user with advertiser opportunities and increased prices, PYMNTS reported in January.

Amazon Prime Video implemented a new $2.99/month charge for ad-free viewing, otherwise integrating advertisement breaks into its content. In addition, key players, including Disney+, Warner Bros. Discovery’s Max and YouTube TV Premium, increased their prices.

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Chicken Soup for the Soul Entertainment, which acquired the DVD rental kiosk company in 2022, told employees of its bankruptcy plans late Friday, The Verge reported Saturday (June 29), citing an internal email.

The company says it has filed for a debtor-in-possession loan, which would let it secure additional working capital to meet payroll as it reorganizes. Employees have been waiting to get paid since June 21, the report said, while their health insurance lapsed in May.

But the report noted that it’s not clear whether Chicken Soup will be able to obtain the loan, as its bankruptcy filing shows it owing money to retailers such as Walmart and Walgreens, major Hollywood studios like Sony and Warner Brothers, plus various smaller studios, streaming platforms and smart TV companies.

According to the report, Chicken Soup took on $325 million in debt with the Redbox acquisition, and listed nearly three times that amount in debt in its bankruptcy filing. The company reportedly also struggled when Hollywood writers and actors went on strike in 2023, leading to a decline in physical DVD/BluRay rentals.

The company’s troubles come as Americans continue to demonstrate their love of streaming media. Findings from PYMNTS Intelligence’s new report “How the World Does Digital” show that almost 35.6% of people in the countries surveyed stream video every day. For the U.S., that figure jumps to nearly 70%.

But as noted here earlier this month — in a report on consumers enjoying “digital-first staycations” — home entertainments are becoming more difficult to afford as they become increasingly subscription-based. 

For example, movie and TV services have been raising their prices in the last year, while Spotify is reportedly hiking the price of its Premium subscription by as much as an additional $5 per month.

Research from the September installment of the PYMNTS Intelligence series “New Reality Check: The Paycheck-to-Paycheck Report, The Nonessential Spending Deep Dive Edition,” found that 25% of consumers reported that they spend indulgently on streaming services. In addition, financially struggling consumers were the most likely to say that their spending in the category has been indulgent.

“As such, the cost of consumers’ at-home movie marathons, for instance, or their ad-free poolside playlist is becoming increasingly burdensome, even as these staycation experiences continue to be a more budget-friendly break than, say, the cost of an Airbnb and the airfare required for a physical getaway,” PYMNTS wrote.

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Having passed both the Senate and the House of Representatives, the bill will become law if signed by President Ferdinand Marcos Jr., Bloomberg reported Friday (June 28).

The bill would impose a 12% value-added tax on foreign digital service providers and is expected to generate about 18 billion pesos (about $308 million) in its first year, according to the report.

The proposed tax aims to nurture Philippines-based streaming platforms, support the development of creative industries, and create a new source of revenue to help pay for the country’s growing budget, the report said.

The bill has been under consideration by lawmakers for four years, since the time of the pandemic, but it has gained momentum as the Philippines faces growing pressure to control its budget deficit, per the report.

The move comes at a time when Netflix and other streaming platforms are working to expand in the Philippines and other Southeast Asian countries, according to the report.

Netflix said in 2022 that it was working to localize payment methods in the Asia-Pacific region to make subscriptions easier for people who want to pay using Unified Payments Interface (UPI), digital wallet and direct carrier billing.

“We accelerated this journey of diversifying payment methods nine months ago and the results have been impressive,” the company said at the time on its website, adding that it had added 16 new payment methods and seen the number of new subscribers signing up with an alternative payment method more than triple between 2020 and 2021.

In April, when reporting its first-quarter earnings, Netflix said it has nearly 270 million paying customers globally and had seen a 15% year-over-year surge in revenue.

The growth not only reaffirmed Netflix’s dominance in the streaming industry but also reflected a broader global shift away from traditional broadcast television toward on-demand content consumption, PYMNTS reported at the time. The company’s addition of 9.3 million paid subscribers in the first quarter alone underscored the increasing demand for premium, personalized entertainment offerings.

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As Bloomberg News reported, the National Music Publishers’ Association (NMPA) filed the complaint with the Federal Trade Commission (FTC) Wednesday (June 13), alleging that the streaming audio platform’s decision to offer audiobooks to subscribers meant fewer royalty payments to songwriters.

The reason? Adding audiobooks allowed Spotify to reclassify its premium subscription offering as a “bundle.” Under the complex rules of the U.S. Copyright Royalty Board, that qualifies Spotify to pay a reduced rate to songwriters since it was now paying license of books and music under the same subscription price.

The NMPA argues that the bundle is illegal, as subscribers were never given the option to stay on a music-only tier, something not yet offered in the U.S. The trade group says Spotify’s decision could mean a $150 million drop in payments to songwriters over the next year.

“This bait-and-switch subscription scheme is ‘saddling’ shoppers with recurring payments for products and services they did not intend to purchase or did not want to continue to purchase,” the NMPA said in a letter to FTC Chair Lina Khan, per the Bloomberg report.

“If allowed to continue, Spotify’s conduct will cost consumers millions of dollars, undermine the music royalty system, and harm competition.”

A spokesperson for Spotify told PYMNTS the NMPA’s claims were “baseless,” and that the company’s approach to pricing is typical of the industry.

“We notify users a month in advance of any price increases and offer easy cancellations as well as multiple plans for users to consider,” the spokesperson said.

As PYMNTS noted when Spotify expanded its audiobooks offering earlier this year, these efforts come “as many consumers are streamlining their entertainment subscription commitments due to financial challenges.”

Joint research by PYMNTS Intelligence and Mastercard found that more than half of consumers said they would reduce their streaming subscriptions if they weren’t able to cover their monthly bills, exceeding any other service in terms of potential cuts.

In addition, findings from another study, “Subscription Commerce Readiness Report: Bridging the Gap Between Subscription Conversion and Retention,” a collaboration between PYMNTS Intelligence and sticky.io, found that cost is the key driver behind subscription cancellations, with nearly 60% of consumers saying it led them to discontinue a subscription in the prior year.

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Beginning immediately for new subscribers and on the July billing date of existing subscribers, the new prices for the plans are $11.99 for Individual, $16.99 for Duo, $19.99 for Family and $5.99 for Student, the streaming service said in a Monday (June 3) blog post.

The first three prices are up from $10.99, $14.99 and $16.99 respectively. The price of the Student plan is unchanged, CNBC reported Monday.

Spotify last raised its prices in July 2023, when it increased the prices of all four plans, the report said.

“So that we can continue to invest in and innovate on our product features and bring users the best experience, we occasionally update our prices,” Spotify said in its Monday blog post.

This announcement comes about six weeks after Spotify said during an earnings call that 2024 will be a “year of monetization” after making gains in revenue growth, margin expansion and enhanced efficiency.

During the first quarter, the streaming service saw year-over-year gains of 19% in monthly active users, 14% in subscribers and 20% in total revenue, Spotify reported on April 23.

The company also reported that it had made value enhancements across its music, video and podcasting platforms. For example, it expanded its library of over 100 million music tracks.

“And that’s also why you saw us having a healthy guidance on the subs [subscriber] number too, because we think consumers like what they’re seeing from Spotify,” Daniel Ek, founder and CEO of Spotify, said during the call. “They love the offering and they feel that the value that they’re getting is more than fair.”

In October 2023, following the prices hikes for its subscription plans made in July, which resulted in monthly bills increasing by $1 to $2, depending on the specific plan, Spotify reported that “the early effects of price increases” played a significant role in the company’s 11% year-over-year revenue growth.

It also reported that it had raised prices without significant loss of subscribers, indicating that users value the platform.

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