Disney+ and HBO Max have significant portions of their subscriber bases on free promotions but they pale in comparison to Apple TV+, according to MoffettNathanson.
The research firm’s new quarterly SVOD tracker – assembled with help from HarrisX – found that in the fourth quarter, 16% of Disney+ users were still accessing the service through the promotional partnership with Verizon (down from 18% in the third quarter) and that 26% of HBO Max subscribers were coming in through an AT&T promotion.
Apple TV+, though, came in with a whopping 62% of subscribers on free promotions in the fourth quarter thanks to Apple giving away a free year of the service to all customers who bought devices from the company. MoffettNathanson pointed out that free trial for Apple TV+ has been extended through July.
“In fact, all three services (Disney+, HBO Max and Apple TV+) remain in danger of losing momentum if they are not able to entice renewals with exciting original content in the coming months,” wrote Michael Nathanson in a research note. “Disney and WarnerMedia have been clear about strengthening their respective content offerings, but it seems Apple is still not all-in on making Apple TV+ originals a focal point.”
MoffettNathanson and HarrisX asked subscribers if they planned to re-up once their promotional period is up: 48% of Disney+ subscribers said they planned to re-subscribe, 33% said they were unsure and 19% said they did not plan to renew. Just 30% of Apple TV+ promo subscribers said they plan to renew while 41% said they were unsure and 29% said they didn’t plan to renew. The firm said those figures imply that 18% of Apple TV+ subscribers plan to leave the service after the promotional pricing ends.
In addition to promo subscriber breakouts, MoffettNathanson’s new report also showed a growing percentage of households taking up streaming. Streaming service penetration among U.S. households reached 77% in December 2020, up from 72% in December 2019. Among the major SVODs, Netflix leads with 70% penetration followed by Amazon Prime Video with 52%, Hulu with 38% and Disney+ with 31%. HBO Max and Apple TV+ trailed far behind with 13% and 8% penetration, respectively.