U.S. consumers are viewing slightly more subscription VOD services than a year ago, with most households, especially those with kids under 18, “churning through streaming TV services less frequently than they were during the first year” of the COVID-19 pandemic, reported NPD Wednesday. The average number of SVOD services per U.S. user reached 4.6 in April, down from the “mid-pandemic” peak of 5.2 in October 2020 but up from 4.3 in April 2021, it said. SVOD cancellations and declines in viewership are less likely to be driven by switching to other services than they were in early 2021, said NPD. The top driver of churn currently is that consumers “aren’t watching as much as before, with 33% of SVOD viewers making this claim, up from 29% a year ago,” it said. “These results aren’t surprising when you consider the fact that so many of us were stuck at home during the pandemic with plenty of time on our hands to try the direct-to-consumer SVOD services that had recently launched,” said John Buffone, NPD executive director-industry analyst. “We’re still above the levels that we were seeing before the pandemic started. During the first two months of 2022, streaming volumes had settled at levels seen between 2019 and 2021. When this all pans out, we do expect to see a net positive environment for the industry.”

Streaming services asked the Illinois attorney general to weigh in on the constitutionality of the state's Cable and Video Competition Law, they told the U.S. District Court in East St. Louis in a notice of constitutional question Tuesday. East St. Louis sued, seeking franchise fees from the streamers under the CVCL. In the docket 3:21-cv-561 filing, the services said the city's proposed application of the CVCL violates the First Amendment by creating a prior restraint on speech and imposing an unconstitutionally excessive fee. Outside counsel for the city didn't comment.

The major MVPDs lost about 1.96 million subscribers in Q1 -- roughly in line with the losses they had in Q1 2021 and Q1 2020, Leichtman Research Group said Tuesday. Combined they have about 74.1 million subs, LRG said. It said they lost roughly 4.74 million subs over the past year, compared with 4.82 million the previous year. It said the largest cable operators lost about 825,000 in Q1, up from a loss of about 780,000 in Q1 2021. It said the top publicly reporting virtual MVPDs lost about 505,000 subs in Q1, accelerating from a loss of about 265,000 year over year. It said DBS operators lost 528,000 in Q1, while telcos lost 95,000.

Reno's appeal of a lower court's rejection of its suit seeking franchise fees from Hulu and Netflix (see 2202080088) could go to oral argument in San Francisco the week of Aug. 29 or Sept. 19, the 9th U.S. Circuit Court of Appeals said in a docket 21-16560 docket notation Friday.

Staggered releases of popular TV series could prop up the subscriber count at Netflix, Wedbush Securities analyst Michael Pachter wrote investors Monday, upgrading the stock to "outperform." The analyst believes Netflix will exceed guidance for Q2 due to the staggered release date for Ozark, and it believes the same approach for Stranger Things in Q3 could also reduce churn. “Netflix is positioned to grow,” as the subscription VOD service “gradually” raises prices and rolls out an ad-supported option, Pachter said; he doesn’t believe Netflix’s share price will approach 2021 levels “for many years.” Wedbush sees recent Netflix losses as the result of “deep saturation” in the U.S. and Canada. The company’s plans to crack down on password sharing -- which Netflix estimates at 30 million households in those two markets and 100 million globally -- will bring it a “few million new customers.” But its plan to offer an advertising-supported tier “has great potential to drive significant revenue,” he said. Raising prices in mature markets would allow Netflix to drive up its average revenue per user, and its level of profitability, allowing it to reinvest profits to continue growing in Latin America and Asia-Pacific, he said.

The Redbox Entertainment “legacy business” of 38,000 DVD-rental kiosks “still has tremendous reach and power for consumers looking for the ultimate value,” said CEO Galen Smith, appearing on Thursday’s Q1 earnings call of Chicken Soup for the Soul Entertainment to discuss its proposed $375 million Redbox buy (see 2205110051). Redbox has been “investing heavily” in recent years to transform the company into a “multi-window multifaceted digital entertainment company,” said Smith. But COVID-19 “severely impacted” the Redbox kiosk business when it forced studios to release content on streaming platforms or delay movies “completely outright,” he said. The expected recovery has taken “longer than we expected,” and has “hampered our ability to invest in the digital transformation,” he said. “Joining forces” with CSSE will give Redbox “much needed scale,” plus access to capital, to “power” the digital transformation, “something we couldn’t do on our own,” he said.

Google withdrew its UHD Alliance membership, as did human interface components supplier Synaptics and Chinese semiconductor maker Beijing Eswin Computing Technology, the association told DOJ and the FTC in simultaneous “written notifications” March 21, says a notice for Friday’s Federal Register. UHDA membership "remains open," and the association "intends to file additional written notifications disclosing all changes," said Suzanne Morris, chief-premerger and division statistics in DOJ’s Antitrust Division. The notifications are required to extend UHDA members antitrust protections under the 1993 National Cooperative Research and Production Act, said Morris.

Chicken Soup for the Soul Entertainment, owner of the Crackle video streaming service, agreed to buy Redbox Entertainment in a deal designed around scale, said the companies Wednesday. The combination will create an “independent, integrated direct-to-consumer media platform delivering premium entertainment for value conscious consumers,” they said. The combined company will have Redbox’s 38,000-plus kiosks, digital capabilities in ad-based, transactional and premium video-on-demand and free, ad-supported streaming TV channels, plus access to a 40-million Redbox Perks member list. The companies will build a “fully developed AVOD and FAST streaming business: proven branded streaming services, formidable content and production capabilities, and a strong AVOD and FAST ad sales operation,” said Chicken Soup CEO William Rouhana. Redbox CEO Galen Smith said the purchase will “accelerate Redbox’s transition from a physical to high growth digital media company.” Ad spending on connected TV platforms grew 57% from 2020 to 2021 and is expected to grow another 39% this year, they said, citing Interactive Advertising Bureau figures. The deal, valued at $375 million, includes $50 million in Chicken Soup stock and the assumption of $325 million in Redbox debt. Upon closing, expected in the second half, Chicken Soup for the Soul stockholders will own about 76.5% of the combined company, Redbox stockholders 23.5%, they said.

YouTube's subscription VOD service YouTube TV is adding a pair of Spanish-language packages, Spanish Plan and Spanish Plus, it blogged Tuesday. The $35/month Spanish Plan has more than two dozen Spanish language channels and doesn't require subscription to the YouTube TV base plan. The $15/month Spanish Plus add-on to the base plan also features close to two dozen Spanish language channels.

AMC Entertainment won’t stop trying to "convince" some of the major streaming services to introduce their movies theatrically, said CEO Adam Aron on a Q1 earnings call Monday. “We have had conversations over the years with Netflix, Amazon and Apple,” he said. “We continue to make it very clear that we would be very pleased to show some of their bigger, better movies. But in doing so, we have to respect our long-standing industry partners, the major studios. We can't have one set of rules for the major studios and a separate set of rules for streamers.” The $187.4 million domestic opening last weekend of Disney's Doctor Strange in the Multiverse of Madness is proof “all those who doubted the consumer appeal of movie theaters” were wrong, said Aron. “We can say to our shareholders with some glee and delight that the resilience of movie theaters is right now on clear display and that the future of the cinema is bright,” he said. Some on Wall Street and in the media “have been filling our heads for two years now about the rise of streaming and the corresponding end of theaters,” he said. “This won't be the first time or the last time that conventional wisdom will be proven to be filled with so much folly.”