It is time for Subscription Insider’s annual subscription predictions feature. Just three weeks into the new year, we are already seeing subscription trends that will set the pace for 2022: Netflix’s price increase, HBO Max’s price decrease, Microsoft’s acquisition of Activision Blizzard, and Mastercard’s moves toward more transparency, just to name a few. In this member’s only feature, we’ll share our subscription predictions for 2022 for streaming video, streaming audio, gaming, payments and the ever-changing regulatory environment.

Subscription Predictions: Streaming Video

Some industry experts have suggested that streaming services will see some consolidation in 2022. With the exception of WarnerMedia’s merger with Discovery, Inc., we don’t expect to see the predicted consolidations among the major players – Netflix, Amazon Prime, Disney+ (along with Hulu and ESPN), HBO Max and Peacock – but we see some potential acquisition of content or of smaller, niche streaming services by some of the bigger players.

Other streaming video subscription predictions for 2022 include price increases, business model shifts, new launches and jockeying for market share. In the last week, Netflix announced price increases ranging from $1 to $2 per month, depending on the plan. Their last price increase was in November 2020. Several other services announced changes last year, but we might see some price increases from other services. At the same time Netflix announced its price increase, HBO Max announced a price decrease, perhaps hoping to capture price-sensitive subscribers. Their prices are now $7.99 a month for the ad-supported plan (normally $9.99) and $11.99 a month for the ad-free plan (normally $14.99). Prices are available for a full year, but the offer is only good until January 25, 2022.

Business model shifts may include the addition of new tiers either at different price points or possibly other business models. Last summer, for example, just a year after launch, HBO Max added an ad-supported tier. This made their service more accessible to price-sensitive consumers who don’t mind sitting through a few ads and who are willing to forego access to same-day viewing of theatrical releases. Other platforms could explore this option if their ad-free services become too spendy for households who subscribe to multiple services.

Jockeying for market share will always be part of the streaming marketplace, but we predict it will become even more competitive this year, specifically in terms of content. Platforms and studios will spend in the tens of billions of dollars to ensure they have the best and most exclusive content, including originals and licensing rights to movies and shows not available elsewhere. For example, in their fiscal year 2022, Disney plans to spend $33 billion on content, an $8 billion increase over the prior year. They will tease their content slates, as WarnerMedia did recently, and share viewership numbers to show why they have the best content.

The content game will also include how streaming video services handle theatrical releases. This was a change to the subscription business model in 2020 when theaters around the globe were shuttered as the pandemic raged on. Disney+ and HBO Max each handled their movie releases a bit differently, and we can see that shift as the world adapts to new constraints and paradigms around the pandemic. And, of course, we expect to see streaming subscription services like CNN+ launch. At publication, CNN planned a spring launch for CNN+.

Subscription Predictions: Audio

In 2021, everyone wanted a piece of the podcast pie, and we think this will push the biggest audio players to step up their efforts this year. Both Spotify and Apple Music launched their podcast subscription platforms in 2021, allowing users to subscribe to their favorite creators and support them directly. With both plans, fans can access extra content, as well as ad-free content.

NPR launched NPR+, which allows listeners to access their favorite NPR podcasts through their preferred listening platform, and they are already working to beef up their content for 2022. In addition to audio podcasting, Spotify opened up the pathway to video podcast publishing with Anchor. Apple helped Wondery launch Wondery Plus Kids for kid-friendly podcast content, allowing Apple users to get content from Tinkercast, as well as some Audible originals.

We think Spotify is going to take on more projects this year as well, following a year of acquisitions, new features, new launches and new partnerships. In December, for example, Spotify forged a stronger relationship with Tinder to create a better way for users to find potential matches based on their music tastes. Together, the two companies created Music Mode, which allows users to have 30-second looped previews of their selected Anthems on their dating profile, adding another layer to potential connections.

Audiobooks are a thing now as more and more people are diving into books and audiobooks due to the pandemic, and the streaming audio services like Spotify and Apple don’t want to be left out. Books have been seen everywhere on Instagram and TikTok. Spotify wants to be the place subscribers go to listen to everything.

In November, they acquired audiobook distributor Findaway. Spotify’s Chief Research & Developer Officer said, “It is Spotify’s ambition to be the destination for all things audio, both for listeners and creators. The acquisition of Findaway will accelerate Spotify’s presence in the audiobook space, and will help us more quickly reach that ambition.”

Rumor has it that Apple is potentially starting an audiobook service. In an article from The Economist, they speculated that we might see an audiobook service coming from Apple this year. However, the competitor here wouldn’t be Spotify; it would be Amazon. Apple and Audible have previously had a relationship, and Apple would have to step up their game to make it stand out as a competitor.

In 2022, we may see more acquisitions from streaming audio services. Amazon, Apple, Spotify, SiriusXM and iHeart Radio have big budgets and big hopes to grow their market share. To do so, they need to provide the best user experience, content and features. An easy way to provide these is to acquire companies who specialize in different aspects. For example, in 2021, Spotify acquired Podz to improve podcast discoverability. We could see similar acquistions from the major players this year.

Subscription Predictions: Gaming

Subscription gaming has been around for quite some time, but it’s been featured in the media quite a lot lately. Our subscription predictions for 2022: The gaming industry is about to get a lot bigger. The major gaming companies will expand with the acquisition of smaller companies and developers, and they’ll tailor subscription services to better compete with each other.

Earlier this week, Microsoft announced that they were going to acquire Activision Blizzard for $68.7 billion in an all-cash deal – their largest acquisition ever. When the deal goes through, Microsoft will be the third-biggest gaming company by revenue, following Tencent and Sony. Microsoft will absorb 400 million active monthly users in 190 countries, and Activision Blizzard will become a part of Microsoft’s Game Pass portfolio, which is already at 25 million subscribers. We can already hear the new recurring revenue coming in.

EMarketer reported that PlayStation and Xbox were among the most popular subscription services for gamers. On Sony’s end, they are working to create a new subscription that could rival Xbox’s Game Pass. The new and improving gaming subscription service will combine their PlayStation Plus and PlayStation Now services, currently called Spartacus. PlayStation confirmed they would stick with PlayStation Now branding, but ultimately phase out their stand-alone cloud gaming service, PlayStation Now.

From all the buzz about Spartacus, it seems that the new service would combine benefits from PlayStation Now and PlayStation Plus, in a tiered format. Existing benefits include free games each month, free add-on content, as well as streaming games that aren’t available on a current console. Spartacus will be offered for both PlayStation 4 and 5, so those without a PlayStation 5 need not worry. We predict that we’ll see this roll out sometime this year.

Netflix will continue their foray into gaming. In October, Netflix announced that they were buying Night School Studio to help expand their games team. In November, they officially launched five mobile games on Android. Gaming is currently included as a benefit of Netflix membership, where users can access ad-free games provided by the streaming giant. Their recent price increase will help them further fund their gaming goals.

Epic Games currently hosts a large gaming store, as well as having developed one of the most popular games of recent years, Fortnite. In April, Epic Games successfully secured $1 billion in funding, increasing their total value to $28.7 billion. One investor that stood out? Sony.

Kenichiro Yosihda of Sony Group Corporation had this to say of the relationship between the two, “Epic continues to deliver revolutionary experiences through their array of cutting-edge technologies that support creators in gaming and across the digital entertainment industry. We are excited to strengthen our collaboration to bring new entertainment experiences to people around the world. I strongly believe that this aligns with our purpose to fill the world with emotion, through the power of creativity and technology.”

Subscription Predictions: Payments

The payments world is a vast space too broad to cover in just a few paragraphs, so we’ll just touch on a few of our subscription predictions for 2022.

Earlier this week, Marc Roth of Cobalt Law revealed some of the changes Mastercard plans to roll out starting in March. The new rules will impact free-to-pay offers and subscription billing programs. These new and unique disclosure and notice requirements will be imposed on merchants with very little notice. These changes had been rumored late last year, but we are learning more about how merchants will be impacted. For example, effective March 22, negative option merchants will be required to send Mastercard cardholders a receipt following every billing transaction with instructions on how to cancel. This could cause Mastercard competitors to revisit their processes too.

Buy Now, Pay Later will continue to grow in popularity, and the biggest players will get bigger and add more users to their ranks. As of June 2021, Klarna had the most active users at 90 million, followed by Afterpay at 16 million and Affirm at 7 million. Spending will also continue to grow. In May 2021, BNPL lending in the U.S. was just under $60 billion. It is expected to grow to just under $80 billion this year, and just under $120 billion by 2024.

Emarketer reports that the Consumer Financial Protection Bureau is looking into Affirm, Afterpay, Klarna, PayPal and Zip to ensure compliance with lending and disclosure practices. The CFPB asked the companies about their business practices in December and have required the companies’ responses by March 1, 2022. There are three key areas of concern: debt accumulation, regulatory arbitrage, and usage of customer data. This could mean more regulatory requirements for BNPL companies serving the U.S.

Forrester expects to see more QR code payments and digital wallets in use this year. This trend has been spurred on by the pandemic, as the use of biometrics and touchless payments have grown. Even TSA is getting in on the action. While they don’t take payments, in some states they are accepting digital forms of ID in digital wallets. In other states, people can use digital verification of their vaccine status.

In 2022, fintech firms like Square, Stripe and PayPal will continue to provide stiff competition from traditional payment processors and card issuers. Banks will need to upgrade their technology and offer competitive pricing and better features and benefits to keep their current customers and attract new ones. This includes payments, payment processing fees and even lending.

And, of course, no subscription predictions on payments could go without mentioning cryptocurrency. It seems most of us don’t really understand the concept fully, but because of its very nature, cryptocurrency is currently hard to regulate. Reuters reports that regulators are looking at the risks the digital currency poses and whether or not regulations can be imposed to protect consumers.

Subscription predictions: regulation and compliance

In the last several years, the Federal Trade Commission has been laser-focused on the subscription industry to ensure that consumers are treated fairly, receive proper disclosures prior to and during their customer relationship with subscription companies, and are sufficiently punished when they cross the line. Antitrust concerns are also high on the FTC’s list of things to battle in 2022.

In October, the FTC put more than 700 companies – including many subscription companies – on notice that fake reviews and testimonials on social media would not be tolerated. In fact, the FTC said they would use every tool at their disposal to fight against fake reviews. Companies who violate their requirements could be fined up to $43,792 in civil penalties per violation. We are just starting out the year, but we suspect the FTC will make an example of an offending companies this year.

“Fake reviews and other forms of deceptive endorsements cheat consumers and undercut honest businesses. Advertisers will pay a price if they engage in these deceptive practices,” said Samuel Levine, director of the FTC’s bureau of consumer protection, in an October 13, 2021 news release.

In a bigger move, the FTC warned specifically against subscription tricks and traps, promising to step up enforcement to fight deceptive negative option marketing practices. In late October, the regulatory agency issued a new 15-page enforcement policy statement putting subscription companies on notice that the agency would not tolerate subscription practices that attempt to deceive consumers.

The FTC wrote the policy statement to address deceptive negative option marketing practices, as well as the thousands of consumer complaints they receive each year. Such practices and the FTC’s enforcement is based on Section 5 of the FTC Act, the Restore Online Shoppers’ Confidence Act (ROSCA) and the Telemarketing Sales Rule, as well as the Rule on the Use of Prenotification Negative Option Plans, the Electronic Fund Transfer Act and the Postal Reorganization Act.

Subscription companies that use illegal “dark patterns,” or subscription tricks and traps, will face legal action if the companies do not provide clear, transparent information to consumers up front; fail to obtain informed consent from customers; or that make cancellation difficult or impossible.

“Today’s enforcement policy statement makes clear that tricking consumers into signing up for subscription programs or trapping them when they try to cancel is against the law,” said Levine in an October 29, 2021 news release. “Firms that deploy dark patterns and other dirty tricks should take notice.”

On the antitrust front, the federal government has argued that big tech – Amazon, Apple, Facebook, Google, Microsoft – have gotten too big and are misusing their dominant market power to overshadow and bully smaller players to retain their competitive positions. Though there is a long way to go, Recode said there is a bipartisan movement at the state and federal levels to expand antitrust laws to keep these companies in check.

In one of the more notable cases in 2021, the FTC sued Facebook for illegal monopolization. The case was initially dismissed in a federal court in June, but the FTC has since strengthened its complaint that Facebook has used its dominant market position to acquire competitors like WhatsApp and Instagram. Earlier this month, a federal judge gave the go ahead to pursue the case.

“The Federal Trade Commission’s first antitrust suit against Facebook, Inc. stumbled out of the starting blocks, as this Court dismissed the Complaint last June,” U.S. District Court Judge James Boasberg wrote in a court filing. He said while the Commission’s core theory remains the same in its updated complaint, “The facts alleged this time around to fortify those theories, however, are far more robust and detailed than before, particularly in regard to the contours of Defendant’s alleged monopoly.”

We are likely to see similar antitrust cases brought in the European Union.