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Streaming Price Wars has begun



Photo illustration: Grib and AMC

Worried about how to beat the ever-increasing costs of streaming? Good news: Although Netflix recently increased its monthly fee – and Disney + is about to do the same – a price war has broken out among several of the newer platforms. As they struggle to get cost-conscious consumers to notice them, baby streamers have been serving up some particularly attractive deals in recent weeks. The savings can be significant – especially if you are willing to commit in the long run.

Ahead of next month’s transformation of CBS All Access into Paramount +, owner ViacomCBS allows consumers to sign up for one year of the platform for one as much as 50 percent discount the usual price tag. Committing to an annual plan currently costs as little as $ 30 (or $ 2.50 per month) for the ad-supported version of the streamer. The ad-free version of the service is available for $ 50 per year, or $ 5 per month. The $ 30 plan is similar, but not quite as attractive, as Hulu’s recent Black Friday offer, which reduced the price of the service to just under $ 2 per month with a one-year commitment. However, Hulu did not give the deep discount for its ad-free plan.

Just launched Discovery + has trimmed the prices of two of its ad-free plans by 30 percent, at least through Sunday. As part of a Valentine’s Day promotion, a six-month subscription is down to $ 29 (instead of the usual $ 42), while a year currently costs $ 59 (compared to the usual $ 84). Warnings: Discounts do not apply to the ad-supported version of Discovery + (which remains $ 5 per month), and keep in mind that if you are a Verizon subscriber, you may be eligible for a free trial period of six or twelve months.

➽ HBO Max has expanded a holiday campaign that trims a little more than 20 percent discount the cost of a subscription, reduces the streamer’s regular price of $ 15 per month to $ 70 if you prepay for six months (that’s $ 11.67 per month). This is followed by a September campaign that allows customers to lock in savings for an entire year. (HBO Max is still offered for free to many AT&T wireless and telephone customers.)

Given the number of large streamers that have bent over the past 18 months, it is not so surprising that companies have to stress to get consumers to check them out. The pandemic has people streaming several TV series and movies, but unemployment is still high, and millions are likely to reduce the cost of insignificant budget items. In addition, the proliferation of new platforms means getting Jane Q. Streamer to add another $ 5, $ 10 or $ 15 for another service is a big question – especially when Netflix, Hulu, Amazon and now Disney + are so well established . Making streaming cheaper can be an easy way to get cost-conscious prospects to smash that subscription button. “It’s about grabbing the land share,” explains LightShed partner and media analyst Rich Greenfield, who says Wall Street wants to know that these new services will be sampled for at least a one-week (or one-month) trial period. “Investors reward companies for subscribers [tallies]. ”

Most of the current offers keep the monthly base rate unchanged, but instead only offer a break if a consumer is willing to commit for at least six months or more. It is no coincidence. “They try to lock people in to avoid churn,” Greenfield says. In fact, unlike cable TV – where getting rid of an HBO or Showtime add-on requires calling in, waiting for a customer service representative, and then hoping you’re not attacked by a desperate plea not to downgrade – it’s very easy someone to cancel a streaming service. A few clicks and you are good to go. Long-term plans give new services respite as they work to build the subscriber base and programming libraries. (The last point is the key right now, given the pandemic’s continued effect on the production pipeline.)

Avoiding churn can also be the reason why we have seen more streaming bundles appear too late. For example, Disney offers Disney + packaged with Hulu and ESPN + at a discounted price of $ 13 per month (versus $ 18 per month if you purchase it separately). Although the package is not much, unless you are a frequent user of all three services, it gives consumers the perception of value and expanded choice. This in turn reduces the churn, since someone who does not feel Disney + in a few months will probably stay if they are served by Hulu and ESPN +.

By the way, Disney has been a pioneer in offering deep discounts in exchange for loyalty: It has offered a cheaper annual plan for Disney + since it started signing up, and even gave its best super fans the chance to lock in a low price for a full three years. (Given next month’s planned price increase, it turned out to be a very good deal for consumers.) Disney’s streaming strategy takes a side from its consumer park division, which for decades has allowed California and Florida residents to buy annual cards to build loyalty to the Disney mark (and keep the parks full when it’s not tourist season).

Bundles are also a great way for businesses to maximize the value of smaller platforms. AMC Networks, for example, has put together an impressive collection of niche streamers such as Shudder, Sundance Now and IFC Films Unlimited. They are all quality platforms, but individually they have limited appeal. So the company recently decided to add the entire library of content from all three services to a new supersize app called AMC +, and throw in a selection of shows from AMC proper and BBC America as a bonus. The whole package is priced at $ 9 per month, which is not cheap, but is also less than half of what the three special streams cost on a stand-alone basis.

ViacomCBS has also tested a number of types. It sells Showtime and the ad-free version of CBS All Access / Paramount + – $ 21 if purchased à la carte – for only $ 10 per month. The only problem: You must also be an Apple TV + subscriber. Given Apple’s own commitment to discount right now – most of its current users get the service for free as a bonus for buying Apple products – the ViacomCBS package is a particularly sweet deal, at least if you’re a fan of CBS and Showtime programming.

Of course, everyone who signs up for these deals must know that we may be living through what will soon be known as the good old days of streaming discounts. Much like Netflix finally got rid of its 30-day free trial, when these new streamers mature, they will almost certainly drop the offers. Attracting new subscribers is crucial (pun intended) right now for novice services, but as Greenfield points out, “the question will eventually be, what is the profitability of these subscribers.” It’s great to have 50 million subscribers, but if they only pay a few dollars a month, they’re probably not earning a lot of money.

In India and a few other countries, for example, Disney offers Disney + with its general entertainment Hotstar for something like $ 20 per year. It gives it wide reach (and helps increase global Disney + subscribers), but results in Disney generating less revenue per subscriber than it does in other countries. While newer streamers do not offer Hotstar-like discounts in the United States, they definitely sell their goods well below sustainable long-term cost. It will not last. “At some point, if your service is good enough, it must be good enough to guarantee a subscription” at a non-discounted price, says Greenfield. Also, even if something is (relatively) cheap, consumers will not stay registered forever if they do not feel a service is worth it. “People are not going to continue if they are not engaged.”

Is Disney + about to cross 100 million subscriber brands? Probably No, but I would not be shocked if Mouse House were still stunned when it reported fourth-quarter earnings – and its current subscriber numbers – later today. December’s investor presentation (you know, the one where the company said it would break something like 5,000 new shows from the IP library), not only impressed Wall Street; it also served as a brilliant marketing stunt aimed at hunting down holiday customers to give the gift to Disney +. That, combined with the strong numbers for Pixar Soul, could in theory have run a series of registrations and put Big D over the magic milestone. It will be close: Disney + was at 87 million in early December, and analysts like JPMorgan’s Alexia Quadrani are very optimistic (she predicts 95 million). We get news after the stock market closes this afternoon.

Coincidental fact: I never listened to that “Baby Shark” song all the way. My personal boycott aside, people whose children can’t get enough of the musically monotonous fish, now have a reason to check out the Roku Channel. Roku’s free, ad-supported streamer adds a live, linear channel devoted to non-Baby Shark content, giving parents another way to keep their kiddos busy. The Baby Shark channel is one of 13 virtual channels that will join Roku’s live lineup from today. Other new options:

Six channels dedicated to different music video genres, including 80s and 90s music for us old ones (plus channels that play hip-hop, country and party jams.) Programming comes from Loop, a new company that serves on-on requires video playlists via its mobile and TV apps, and is already doing the direct linear thing on Roku Channel’s competitor Plex. This is very good news for those of us who still remember when MTV played music videos (but when will anyone bring back VJs?).

K-Pop stops can get Korean variety and reality shows, music specialties and drama on K-ID and K-Korean dramas like Secret Garden at Kocowa Classical.

Hallmark Movies & More collects content from the Hallmark Channel library.

Bloomberg Quicktake serves news to thousands of audiences (see also: Cheddar).

CineVault Westerns will feature oats from the Sony library, while Cine Romántico will feature Spanish-language romantic films.

While we’re on the topic of ad-supported VOD, it’s a big week for Fox-owned Tubi. The streamer is in the middle of a massive campaign push, it is called Free Like Tubi Week, which basically consists of many targeted promotional stunts and gifts on social media (including Fox’s various show handles). This morning, it unveiled plans for a massive expansion of the already impressive News On Tubi hub, announcing that it will add live news feeds from over 80 local TV stations around the country over the next few months.

And perhaps most interestingly, on Monday, Tubi said they had acquired director Danny Madden’s Sundance selection Beast Beast and begins streaming the feature film Friday. While it undoubtedly did not pay close to $ 25 million or so, Apple TV + threw down the much bigger Sundance sensation CODA, that Tubi spent money on a feature film at all, is a sign of how serious it – and other companies – are about the free on-demand streaming area. Amazon’s IMDb TV is already producing original shows, Roku recently invested serious coinage in the remnants of Quibi, and I expect we’ll see even more ambitious plays coming in 2021. The race to make AVOD the new broadcast TV is on.


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