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Disney and Warner Bros. try to ‘follow the consumer’ with yet another streaming package
Warner Bros. DiscoveryWBD) and Disney (DIS) newly announced streaming package is the latest attempt by media companies to appease a more fickle subscriber.
“Ultimately, you have to follow the consumer,” said David Zaslav, CEO of WBD, during the company meeting. first quarter earnings release on Thursday. “We need to come together and offer a better consumer experience, a more attractive and interesting offer, or there will be other companies that will do it for us.”
The bundle, announced on Wednesday, will bring together the Disney+, Hulu and Max streaming services with a launch date set for this summer in the US. Customers will be able to subscribe to the package, with or without ads, on any of the three platforms.
While pricing has not yet been released, WBD management said on the call that the service “will be priced very attractively to the consumer,” with the ad-supported Hulu and Disney+ bundle priced at $9.99 ($19 .99 without ads) serving as a base.
The developments come as media companies face pressure from investors to scale their streaming services and achieve profitability. At the same time, companies increasingly face competition from tech giants like Amazon (AMZN) and apple (AAPL), that are devouring streaming offers.
The consumer has also become more demanding. On average, U.S. consumers subscribe to four streaming services and spend about $61 per month, according to the latest Digital Media Trends report from Deloitte. This means fewer opportunities to retain loyal subscribers over time.
Zaslav said the upcoming package will bring several benefits to the company, including incremental subscriber growth and long-term retention.
“The ability for us and Disney together to reach consumers is a stronger business,” he said.
The concept of grouping is not new. Companies in the sector have been doing this with their own services for years. Apple, for example, offers Apple One, which combines Apple TV+ with other services like Apple Music and Apple Arcade. The package was launched globally in late 2020.
Disney, which also offers a bundle with Disney+, Hulu and ESPN+, officially began its domestic release of a one-app experience late last year that incorporates content from Hulu via Disney+ – a similar play to Paramount’s Showtime combination as well as the integration of HBO Max and Discovery+who merged their respective services last year.
The move towards partnerships between competing media companieshowever, it gained strength.
The story continues
Earlier this year, Warner Bros. announced a sports streaming partnership with Disney’s ESPN and Fox (FOXA), set to debut this fall. In December, WBD partnered with Netflix (NFLX) in a $10 ad-supported package offered by Verizon (VZ).
On Thursday, Zaslav said the Netflix partnership “is going much better than expected,” citing its success as “another example where there is more strength together.” The company has also entered into a series of partnerships and international packages with telecommunications, mobile phone and broadband companies abroad.
The move to a larger grouping represents “a generational break”, according to Zaslav. “Ultimately, I think the business will be very different in two or three years. And it will be much better for consumers.”
The exterior of the Warner Bros Discovery Atlanta campus is pictured in Atlanta, Georgia, May 2, 2023. (REUTERS/Alyssa Pointer/File Photo) (REUTERS/Reuters)
Alexandra Canal is a senior reporter at Yahoo Finance. Follow her on X @allie_canal, linkedin, and email her at alexandra.canal@yahoofinance.com.
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