Apple and Paramount are reportedly in talks to bundle their discounted streaming services, a possible bid to shore up subscribers amid brutal competition with rivals such as Netflix and Disney+.
The entertainment rivals have talked about combining AppleTV+ and Paramount+ to create a package that would cost less than subscribing to both services separately, people familiar with the situation said. The Wall Street Journal.
Most streamers offer monthly subscriptions, making it easy for viewers to cancel when they finish watching a specific show, The Journal reported, such as when Apple TV+ debuted “Greyhound” in July 2020.
When the hyped World War II film starring Tom Hanks premiered on July 10, 2020, AppleTV+ daily subscriptions in the United States increased dramatically, to nearly 60,000. The day before, there were only 8,500 new users, according to data from the subscriber measurement company Antenna.
The following week, new subscriptions to AppleTV+ dropped again to about 10,000 per day, Antenna reported, according to The Journal.
Both AppleTV+ and Paramount+ had more than 7% of viewers canceling their subscriptions in October, known in the industry as the “churn” rate.
The figure surpassed the 5.1% churn average for the entire streaming industry last month, The Journal reported, citing data from Antenna.
AppleTV+’s user base fell as the company raised its subscription prices, although Apple insisted the move reflects its focus on adding higher-quality content and features to the platform.
At the end of October, the monthly price of Apple TV+ increased by $3, to $9.99.
Paramount raised its streaming prices earlier this year after its first-quarter earnings came in lower than expected.
The price of Paramount+’s base Essential tier is now $1 higher than it was in early 2023, at $5.99, while its ad-free Premium tier, which also includes content from Showtime, rose from $9.99 to $11.99.
The Post has sought comment from Apple and Paramount.
Streaming giants Netflix and Disney recently raised their prices as they look to drive growth amid intense competition.
Earlier this month, Netflix teamed up with another high-profile streamer, Max, to create a bundle as part of a deal with Verizon, a partnership similar to what Apple and Paramount are expected to make.
As part of the deal, Verizon plans to offer ad-supported versions of Netflix and Warner Bros. Discovery’s Max streaming services for about $10 a month combined instead of about $17. The newspaper reported.
The discounted package is expected to be formally announced in the coming weeks, according to the report, citing people familiar with the situation.
Netflix and Warner Bros. will have to share revenue with Verizon, according to The Journal, adding that although the financial agreement could not be known, there is a minimum guarantee of revenue for the entertainment companies.
Netflix launched its ad-supported tier late last year and is expected to increase prices for its ad-free premium tier to push more subscribers to the next level, where commercials help generate more revenue per user.
Netflix, the only major profitable streamer, has resisted joining rivals such as Walt Disney in raising ad-free prices this year and has instead restricted password sharing outside the home to take advantage of the more than 100 million viewers who use your service without subscribing.
However, a report last month revealed that Netflix could increase the price of its ad-free options in the coming months. after a slow start to your advertising plan.
Their standard plan with ads costs $6.99 per month, while ad-free plans start at $15.49.
