Finally, a streaming story that’s not about price hikes. Verizon is planning to offer the ad-supported versions of Netflix and Warner Bros Discovery's Max streaming services for a combined $10 a month instead of around $17.
According to a Reuters source familiar with the matter, the discounted bundle is expected to be announced in the coming weeks, even though the companies involved are so far declining to comment. The Wall Street Journal was the first to report the news.
Netflix launched its ad-supported tier late last year, and it increased the prices for its premium ad-free tier in October 2023. Last week, Netflix said the ad-based plan had reached 15 million active users per month.
If the reports are true, the streaming companies are betting on the possibility that existing and potential subscribers will be more than happy to have shows like House of the Dragon (Max) and Stranger Things (Netflix) available through a single subscription.
By bundling offerings through distributors such as Verizon, Comcast, Apple, or Amazon, streaming companies can attract more customers. This tactic is especially attractive for ad-supported services that are just getting off the ground.
Netflix and Warner Bros will have to share revenue with Verizon, the Reuters source said. The financial terms of the deal are not yet clear, however.
Streaming platforms need to do something to slow down subscriber defection rates, of course. Ad-based tiers aren’t growing as quickly as the companies hope, and the ad-free plans are getting more expensive.
Netflix has recently raised the price for its lowest-priced ad-free plan from $10 to $12 – even though it is the only major platform not bleeding money. Ad-free Disney+ now costs $14 a month, around 27% more than previously, and Hulu’s ad-free price rose by 20% to $18. Apple TV Plus recently joined the club.
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