Apple TV+ may bundle with Paramount+ to cut subscriber losses
Paramount+ has previously made a similar deal with Showtime. With a bundle, users have an option to get two services for more than the cost of one, but less than the previous cost of the two.
Apple TV+
According to the Wall Street Journal and subscriber-measurement firm Antenna, a bundle decreases the chance that a user will cancel a streamer. Reportedly, users of a single streamer may binge-watch a particular series and then cancel before the following month.
While not specifically stated, presumably users with a bundle are more likely to move to binge watching other shows, because there is a greater number and variety available to them.
Even Netflix, whose library is rivaled only by Disney+, has already become part of a bundle. Netflix is now available alongside Max -- which was itself originally HBO Max and Discovery+ -- in a deal with Verizon.
Antenna says that cancelling users of Apple TV+ and Paramount+, or the "churn rate," was 7% in October 2023. That compares to an industry average of 5.7%.
While streamers themselves do not report their churn rate, Antenna claims that Disney has seen fewer cancellations since it has been offering Disney+, Hulu, and ESPN in a bundle.
Apple itself already bundles Apple TV+ in its Apple One service, where it is sold in a package together with Apple Music, Apple Arcade, and Apple News. Again according to Antenna, Apple One has an unspecified but far lower churn rate than Apple TV+ on its own.
Bundles may be useful to Apple because its Apple TV+ library of shows remains one of the smallest in the industry. A bundle would also be more attractive to subscribers, which may be particularly important after Apple -- and practically all streamers -- have been raising their prices.
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If Apple wants to get serious they could buy the company that owns Paramount and get a huge library of Viacom, CBS and Paramount content. The CBS television network which includes a news division and a sports division. A laundry list of channels. The Pluto ad supported streaming service.
The collection of satellite/cable channels cover children, music, sports, comedy and much more.
By ownership of CBS they get a significant package of College & NFL Football, College Basketball to include March Madness and other sports properties.
Paramount is controlled by a private company called National Amusements that could likely be bought for pocket change. The public shares are currently less than $10 Billion, so it would be an easy pickup if Apple wants to go there.
Paramount would do much better without the meddlesome Redstone family.
It’s simple, really, if streaming services don’t want consumers to only carry their services for part of the year, stop overcharging. Most of us have a hard limit on how much we’re comfortable spending on TV content. Streaming services need to operate with that limit in mind. We’re all getting squeezed from so many directions these days - groceries, housing, transportation and so on - that to just keep paying more and more for something to watch on TV is truly aggravating. In my youth, you put up an antenna, hooked it up to your TV and away you went. Maybe we had to wait a year or so for Hollywood movies to land on network TV and they were broadcast with annoying commercials. Yet, once you paid for that antenna - $100 or so - it was cost-free. Saw a lot of great, classic Hollywood fare that way back in the 1960s and into the 1970s. Today . . .
In my case, I am getting dependable iCloud BU, Apple Music, Apple News (which allowed me to cancel several magazine subscriptions), Apple Fitness as well as AppleTV for myself and my wife. The only thing we don’t use is Apple Arcade since we don’t play games.
Apple doesn’t need to buy old media at an enormous cost. Apple just needs to keep doing what it does. This is especially true if the future of spectator sports and entertainment is a more immersive AR/VR format that will need to be created anew. The attention span economy is already stretched to the point where owning large troves of legacy media just does not make really any financial sense.
So Apple isn’t going to be buying Disney. Sorry.
Analysts seem to not understand what Apple wants to achieve here.
Thanks AI!
Maybe it’s just me, but I feel a bit liberated every time I cancel a streaming service.
Apple takes the long approach with their strategic decisions. The service/catalog grows and becomes more valuable each month — what will it look like in 5-10 years? What will Vision Pro hardware and content look like in 5-10 years?
Another option could be a credit system that works across streaming providers. People would subscribe to get tokens per month.
Say someone has a $10/month plan, they get 1000 tokens. They'd be able to open Netflix without a Netflix account and watch what they have and it would charge some tokens. If you watch an episode of a new TV show, it may take 50 tokens per episode. An old TV series can take 10 tokens per episode.
When the tokens run out, people can top them up or jump to a higher subscription tier and tokens can be shared with family members without having to add new viewers to accounts.
They can be used on Youtube to get ad-free playback, Disney+ when a new movie or show is released etc.
This may be a downside for some platforms in that if you don't watch, you don't pay anything but this is the case with an ad service too. People can also watch ads to accumulate tokens. I'd guess an ad view would be worth around $0.02 so it would need a fair amount of ads to build up tokens and a lot of people would rather pay.
For young people with no income, they can be on family plans or gifted tokens.
I still think the best way to keep subscribers and reduce churn is to have live/nightly content, and this would require some amount of advertising. What if viewers would only see one particular ad once every 50-100 ads? So there wouldn’t be the annoyance of seeing the same ad repeated.
No Severance season 2, Shantaram was cancelled after its initial season. No movies interesting watching (apart from Tetris). I hope that the root cause of this was the scriptwriter strike, and things will improve in 2024 as there are several interesting announcements for January and Feb.
Zuck/FB (and other social media) simply takes the information about you that you offer up, and essentially steals it (claiming you gave them permission.) Offer people targeted ads for something of value, and my guess is you'd have a viable revenue stream.