--- title: "What Is Churn Rate? Definition and Examples | RentAnOTT" description: "Churn rate is the share of subscribers who cancel in a period. See the formula, the difference between voluntary and involuntary churn and how to lower it." url: "https://www.rentanott.com/glossary/churn-rate" markdown_url: "https://www.rentanott.com/glossary/churn-rate.md" category: "Metrics" updated: "2026-10-05" --- # What is churn rate? Churn rate is the percentage of a streaming service's subscribers who cancel or fail to renew during a period, usually a month. It is the main measure of how well a subscription service keeps its customers. ## How to calculate churn rate Divide the subscribers lost during the month by the subscribers you had at the start of it, and multiply by 100. A service that begins the month with 10,000 subscribers and loses 500 has a monthly churn rate of 5%. Count only subscribers who were present at the start. Mixing in people who joined and left within the same month distorts the figure; track those separately as trial or first-month churn. ## Voluntary and involuntary churn They need different fixes. Voluntary churn responds to content, pricing and engagement. Involuntary churn responds to payment retries, reminder emails and a grace period. - Voluntary churn: the subscriber chose to cancel, because of price, a lack of new content or having finished what they came for - Involuntary churn: a renewal payment failed and was never recovered, usually an expired card or insufficient funds ## Why churn matters so much Churn sets how long a subscriber stays, and therefore what one is worth. Average lifetime in months is roughly 1 divided by monthly churn: 20 months at 5%, only 10 months at 10%. Halving churn doubles lifetime value without acquiring a single new customer. ## Ways to reduce churn - Release new content on a steady schedule rather than all at once - Offer annual plans at a discount - Let subscribers pause or move to a cheaper tier instead of cancelling - Recover failed payments with retries and reminders - Ask why at cancellation and act on the commonest answers ## Churn rate on RentAnOTT RentAnOTT analytics report growth, retention, cohorts and churn on every plan. The revenue calculator shows how a change in churn alters subscriber count and revenue over time. [Try the revenue calculator](https://www.rentanott.com/tools/ott-revenue-calculator). ## Related terms - [Retention rate](https://www.rentanott.com/glossary/retention-rate) — Retention rate is the percentage of subscribers, or users, who are still with a service at the end of a period out of those who were there at the start. It is the mirror image of churn rate. - [Involuntary churn](https://www.rentanott.com/glossary/involuntary-churn) — Involuntary churn is the loss of subscribers whose renewal payment failed and was never recovered. They did not choose to cancel; their card expired, was declined or lacked funds, and the subscription lapsed. - [LTV](https://www.rentanott.com/glossary/ltv) — LTV (customer lifetime value) is the total revenue, or margin, a service expects to earn from one subscriber over the whole time they stay. It tells you how much you can afford to spend to acquire a customer. - [MRR](https://www.rentanott.com/glossary/mrr) — MRR (monthly recurring revenue) is the subscription income a service can expect every month from its active subscribers, with all plans normalized to a monthly amount. It excludes one-time sales and other irregular income. - [CAC](https://www.rentanott.com/glossary/cac) — CAC (customer acquisition cost) is the average amount a service spends on marketing and sales to gain one new paying customer. It is total acquisition spending in a period divided by the number of new customers won in that period. - [Dunning](https://www.rentanott.com/glossary/dunning) — Dunning is the process of recovering a subscription payment that has failed. It combines automatic retries of the charge with messages asking the subscriber to update their payment details, over a set period before the subscription is cancelled. ## Further reading - [OTT subscription plans and tiers](https://www.rentanott.com/blogs/ott-subscription-plans) - [SVOD vs VOD: what is the difference?](https://www.rentanott.com/blogs/svod-vs-vod) - [Features](https://www.rentanott.com/features) ## Frequently asked questions ### What is a good churn rate for a streaming service? It varies by niche, price and market, so your own trend is a better guide than a single benchmark. What matters is that lifetime value at your churn rate stays well above what you pay to acquire a subscriber. ### How do monthly and annual churn relate? They compound. A 5% monthly churn means about 54% of subscribers remain after a year, so annual churn is about 46%, not 60%. ### What is the difference between churn rate and retention rate? They are two sides of one figure. Retention rate is 100% minus churn rate for the same period. All 163 terms: [Streaming and OTT glossary](https://www.rentanott.com/glossary). ## Book a demo Tell RentAnOTT what you are launching. The team walks through the platform and maps the path to go-live around your catalog, markets and revenue model. Book a demo: https://www.rentanott.com/contact ## More from RentAnOTT - [Home](https://www.rentanott.com/index.md) — What RentAnOTT is, what every plan includes, and how launch works - [Features](https://www.rentanott.com/features.md) — Every core feature and optional add-on - [Pricing](https://www.rentanott.com/pricing.md) — Platform tiers, apps, add-ons, usage rates and example bills in INR and USD - [Free tools](https://www.rentanott.com/tools.md) — OTT app builder and calculators for streaming revenue, bandwidth, bitrate and pricing - [Insights](https://www.rentanott.com/blogs.md) — All streaming business articles - [Glossary](https://www.rentanott.com/glossary.md) — Definitions of streaming and OTT terms - [Book a demo](https://www.rentanott.com/contact.md) — Talk to RentAnOTT about your launch Full site in one file: https://www.rentanott.com/llms-full.txt