All Together Now: Why Bundling is the Latest Trend in Streaming Pricing

By Max Newfield | August 29, 2024

The calendar says it’s May, but major players in streaming are starting to bundle up.

In the early stages of streaming, the value proposition was simple, “Get rid of your bloated cable subscriptions. Just pay for the content you like.”

Turns out… viewers like having a lot of options.

Or at least, that’s what entertainment companies of all sizes are betting on with their latest subscription offerings. Outlets ranging from indie darlings to legacy media are eschewing exclusive offerings for greater value, offering disparate and diverse bundle options to keep audiences subscribing for the long term.

Related Article: 9 Reasons Content Owners, Digital Publishers, and Media Companies Trust Our Streaming App Builder to Help Tell Their Stories

So what does this mean for everyone else in the streaming space? How should you price your content to stay competitive with other industry leaders? Are we returning to cable packages but this time over the internet (which, we remind you, is also a series of very long physical cables).

Read on for the latest Matchpoint insights!

Last week, news broke that Disney and Warner Bros. Discovery – competitors in one form or another for over 100 years – are teaming up for a bundle of two of the oldest and most celebrated entertainment libraries in American entertainment history.

Details are scarce but for audiences eager for diversity of choice, this likely represents one the largest content offerings available for one subscription as Disney’s Hulu content will also be included. The two companies are prioritizing accessibility as well, with ad-support and ad-free pricing tiers available although specific price points have not been released.

So why would two entertainment giants team up like this?

WBD says the reason is better customer value and increased efficiency but as with all streaming decision making, Netflix is likely a factor.

In the linked Variety article, CEO and president of WBD global streaming and games JB Perrette states that customers will be inclined to maintain the subscription month to month because they feel like they are getting a great value.

Churn rates have skyrocketed in recent years and customer acquisition is a costly expense. But Netflix is uniquely impervious to churn – their churn rates are about half the industry average.

If Disney and WBD can build a resilient subscriber base then they live to fight another day and differentiate themselves from Netflix in other ways.

Paramount

There’s a LOT to be said about the state of Paramount’s content offerings right now as the company mulls purchase offers from both Sony and Skydance Media. And much like their ownership, the company’s streaming products are in flux right now.

Showtime, Paramount’s prestige TV and movie outlet, is no longer available as a standalone app. Instead, the channel is now an additional add-on for Paramount+, which was already a bundle of CBS, Comedy Central, BET, MTV, Paramount Pictures.

Previously, the company had weighed bundling with Peacock as well.

Whatever the future holds for Paramount, it appears the short-term play is bundled content at both ad-free and ad-supported tiers under one, consolidated app.

Good news though, an annual subscription is 50% off right now.

AMC

In its cable TV heyday, AMC was all about quality over quantity when it aired both Mad Men and Breaking Bad – two landmark shows of the Peak TV era.

Now, with AMC+, the network aims for quality AND quantity.

With one subscription, audiences have access to AMC and sister channels Sundance Now and IFC, as well as BBC America, Acorn (your parent’s favorite British detective show channel), and Shudder (for horror fans who love a good scare at an affordable price).

It’s an interesting play for a smaller, comparatively newer network. By bundling multiple niche streaming channels together, AMC avoids costs associated with running multiple services. And anyone interested in two or more of their verticals is likely a subscriber for life.

The company also offers AMC+ and its component channels as ad-on offerings to Amazon Prime subscriptions to enable a high volume of impulse purchases. Who among us hasn’t done the free month of Shudder to watch two scary movies at Halloween?

ESPN + Fox + Warner Bros. Discovery (Again)

Earlier this year, WBD, Fox, and ESPN announced plans to offer one standalone streaming app with 15 linear sports channels covering the NFL, NBA, MLB, NHL, WNBA, NASCAR and college sports, as well as golf, tennis and the FIFA World Cup.

The service would be operated by a new, standalone company with all three pre-existing networks owning an equal stake.

While this likely be a huge convenience for sports fans, it likely represents an existential threat to traditional cable as we know it. Cable companies – the original entertainment bundlers – have long been kept afloat by their exclusive sports offerings. This has led to multiple streaming companies like Fubo and DirectTV to ask Congress to intervene on their behalf, lest they run out of sports to broadcast.

The super sports streaming team-up also represents a major ticking clock for the NBA, which is currently re-negotiating its media rights with multiple networks right now.

So will sports fans finally get to ditch cable for a standalone streaming service? Is Congress going to get involved in the streaming wars? Where will we watch Caitlin Clark make her WNBA debut?

Anyone who has watched the NBA playoffs for more than a few years knows… with live sports anything is possible.

Wondering how all this bundling affects your content strategy? Think you’ve got a way to enter the streaming world but want to know how to do it FAST? Contact us. Our experts will show you how Matchpoint can launch your streaming business in weeks, not months.

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