Verizon has teed up a streaming bundle of Netflix and Warner Bros. Discovery’s Max, offering the ad-supported versions together at a discount of $10 per month for the provider’s myPlan wireless customers.
It confirms a WSJ report last month that Verizon was planning a Netflix-Max streaming bundle.
Under the new offer, which starts December 7, the ad-supported versions of Netflix (usually priced at $6.99 per month) and Max with ads (typically priced at $9.99 per month) will be available together at a discount for $10 per month as a myPlan wireless perk for unlimited customers. Verizon said it represents 40% savings from purchasing both of the services individually.
“Customers want unbeatable offers from top partners that deliver the best services and experiences they want, and on the nation’s most reliable network," said Frank Boulben, chief revenue officer of Verizon Consumer Group, in a statement. “With these only for Verizon deals and first-of-its-kind bundled content offers you can get through myPlan, there’s never been a better time to be a Verizon customer.”
Verizon also offers the Disney bundle of Disney+, Hulu with ads and ESPN+ with ads as a $10 per month myPlan perk – meaning together customers could get the five streaming services for $20 per month. Verizon is one telco offering streaming subscription bundles to customers, including a previously discounted Netflix and Paramount+ with Showtime bundle through its +play subscription aggregation platform.
Other wireless carriers for a while have offered streaming services as value-adds for signing up for mobile service, such as T-Mobile’s “Netflix on Us” offer, or more recent partnerships like a free Spanish-language ViX streaming subscription from TelevisaUnivision. However, pairing or aggregating sometimes competing streaming services together at a discount is a relatively newer tactic. Streamers, meanwhile, are more actively exploring teaming up on bundles as they focus on profitability. Bundles can possibly serve as an avenue to attract subscribers at lowered acquisition costs, including to ad-supported plans, as the services mature and plan prices continue to rise. Notably bundles could also provide a mechanism to potentially reduce churn.
WBD chief David Zaslav, during the company’s third-quarter earnings call, cited churn as “the biggest issue we face” and suggested a concerted effort to reduce on the Max service. He also pegged bundling as key and where the industry is headed.
“I think bundling in terms of the entertainment package is important,” Zaslav said in November. “The ability for us to get together with others domestically, around the world. I think it’s a better package for consumers where we could likely reduce churn and get better economics.”
In terms of rising streaming prices, discounts for combining more than one service together could encourage more consumer uptake. Data released Monday from Hub Entertainment Research found that consumers are taking notice of upward costs for streaming subscriptions. In the firm’s latest survey 85% agreed that streaming video subscriptions are raising their prices more than in the past, and 77% cited budget as the main factor for not adding a new service.
Some telcos hope to entice customers to their networks and services and differentiate with value-adds, with streaming sometimes providing an alternative for TV options - and in Verizon’s case serve as an aggregator to handle the consumer pain point of managing and billing for multiple subscription services, while also delivering cost savings.
On the aggregation front, complexity of multiple entertainment sources and content options are as much of a barrier to taking on new streaming subscriptions as cost, per Hub Entertainment’s research. The survey found that 81% of consumers said there’s a max to the number of services they can use, even if they could afford all of them, with 73% noting its difficult to keep track of all the shows available and where to watch them.
To that end, 59% “strongly” or “somewhat” agreed they would be willing to pay for a “one-stop-shop” that allows them to manage, use and pay for all of their subscriptions in one place.
“Companies who can make entertainment simpler (through things like bundling or universal search) will attract more subscribers. But even more importantly they’ll be offering a service for which many are willing to pay extra – a huge win for companies seeking to make streaming profitable,” said Jon Giegengack, principal at Hub.
Most recently last week it was reported by the WSJ that Apple and Paramount were in early talks to offer a discounted bundle of their respective Apple TV+ and Paramount+ subscription services. For more on that pairing and how streamers and media companies have turned a strategic eye to the possibility of bundling with other services, read here.