Verizon on Wednesday announced the beta launch of its +play subscription aggregator platform, and is looking to lure customers with a free 12-month subscription to Netflix’s premium tier. To get the free Netflix offer, users must first sign up for a seasonal or year-long subscription to one of the other services supported on the +play platform.
Verizon first disclosed plans for +play in March – positioning it as a central one-stop hub where users can search, sign up, manage and pay for a variety of subscription services, with Verizon handling billing, charging subscriptions to a customer's preferred debit or credit card.*
At launch +play and the Netflix offer is available to Verizon customers across wireless, 5G Home and 4G LTE home users. The company said it plans to expand to all customers, including Fios, soon.
A free year of Netflix Premium is a notable incentive, with the service regularly priced at $19.99 per month. And while Verizon already has several other subscription partners signed on, users will have to buy a 12-month or seasonal subscription from the following select pool of services: NFL+, NBA League Pass, Calm, Peloton, Duolingo or AMC+. A spokesperson said the company will expand the offer to more partners in 2023.
Tammy Parker, principal analyst at Global Data, views the caveat to sign up for at least one subscription to get free Netflix as similar to the common tactic of telecom carriers requiring subscribers to step up to higher tier service plans to get free streaming services, and importantly a way to get customers managing multiple subscriptions on the platform out of the gate and help +play become the aggregator it aims for.
“Clearly Netflix is being used as an inducement for a customer to subscribe to at least one additional streaming service on +play, which is key to establishing +play as that user’s subscription hub for multiple services,” Parker told Fierce via email. “Once a customer has Netflix and another streaming service set up through +play, that precedent can lead to the user adding more and more services on the platform. It becomes an iterative process.”
When it comes to perks for Netflix, Parker noted that the streaming giant benefits from any partnership that boosts customer reach and drives revenue streams from new subscribers.
“There might be a slightly negative revenue impact if someone doesn’t pay for a standalone Netflix subscription and instead opts for the free Netflix offer through +play, as I presume Verizon is paying a discounted price to Netflix to offer this perk,” she commented. “But at the end of the free year of service, Netflix and Verizon will both benefit if that customer converts to a paid Netflix subscription through +play.”
Netflix has turned attention to reaccelerating revenue growth through new monetization avenues, including the November launch of a lower cost plan with ads and plans to start charging for account sharing more broadly in early 2023.
After the 12-month free period of Netflix Premium, +play users are able to downgrade and opt for a less expensive Basic or Standard subscription if they choose.
In a statement announcing the launch, Erin McPherson, chief content officer at Verizon, pointed to the operator’s scale and churn benefits.
“The exclusive relationships Verizon has with the top subscription services and content providers, coupled with our distribution scale and customer retention, differentiates us and makes us the partner of choice for providers and customers alike,” McPherson said. “On +play, customers can get savings and value they can’t access anywhere else and our content providers get vast distribution and stickiness that’s beyond reproach.”
Pioneering move for Verizon – but potential for bill shock?
Verizon over the years has taken various unsuccessful stabs at its own media and content efforts (such as the failed go90 mobile video platform for one) and in 2021 sold off its media business, formerly known as Oath, forgoing content ownership ambitions and choosing to focus on its core wireless and connectivity business.
In Parker’s view, +play “is a pioneering move on Verizon’s part and reflects lessons learned” from earlier failed attempts to provide original content itself.
“By creating a hub for streaming subscriptions, Verizon gets a new role in the media ecosystem and provides an exclusive value-added service that its telecom rivals would find difficult to duplicate, provided they even want to,” she said.
To Parker, the question remaining is whether Verizon customers actually want a one-stop shop to manage subscriptions, and if so whether they’ll want Verizon to provide the platform and add charges to their monthly bill.
When it comes to video streaming at least, there appears to be a high affinity for bundling and aggregation, with a Hub Entertainment consumer survey earlier in the year finding a whopping 91% of consumers want access to multiple services in one place. And with the average consumer juggling around 10 video streaming apps, according to TiVo, a place to easily manage and pay could be a useful tool.
Verizon’s +play service also sends notifications to customers to let them know when free trial periods are ending, if there are price changes, and offers for promotions.
However, on the flip side, while aggregating services on one platform makes it easier to manage, seeing them all together in one place could lead to one downside Parker sees: the potential for bill shock.
“It’s easy for consumers to become oblivious to recurring bills for content subscriptions that show up one at a time on a credit or debit card, or are scattered across multiple cards, and are buried within a litany of unrelated personal and household charges,” she commented. “But when all those subscription charges get consolidated onto a single bill that also includes mobile and/or home internet service, the total owed each month could be stunning.”
She added that for consumers this might be a good thing, as it could help them get a better understanding of exactly how much their streaming subscriptions add up to each month.
Although seeing that large monthly bill alongside increased subscription stacking might play into another growing consumer habit – regular cycling between services. Data from Parks Associates found nearly half of OTT subscribers switch between different streaming services each month, often chasing specific content.
*Update: An earlier version of this story incorrectly stated that +play subscription charges would be added to customers' monthly Verizon telecom bill. Subscriptions via +play will be charged to a customer's preferred debit or credit card, renewing individually each month and appearing as line items on their card depending on the start date of the subscription (rather than renewing together on one date).