How Streaming Services Are Bundling Like Cable Networks Used To

Streaming providers have been taking a page out of cable’s playbook by bundling options as more choices threaten to overwhelm cost-conscious consumers.

For decades, when cable TV owners were negotiating retransmission fees with multichannel video programming distributor (MVPDs), they were leveraging their top rated and must-have networks with lower rated networks and start-ups to gain distribution. Eventually the average cable household would have nearly 200 channels receivable but watched only a handful of cable networks. As the cost of a cable subscription soared to more than $100 a month and alternate and less costly viewing options became available, millions of cable subscribers cancelled their subscriptions for NetflixNFLX
and other streaming video services.

Bundling with other companies provides lower subscription costs, increases sampling and helps to subsidize the rising costs of maintaining a competitive streaming service and has promotional value. There have been several examples of bundling with streaming video. Here are a few of them.

Disney: The most familiar streaming bundle comes from Disney. The Disney streaming bundle which combines Disney+, Hulu (with ads) and ESPN+ costs $13.99 per month, a discount of 44% compared to buying the three separately. There are reports that Disney could bundle all three under the Disney+ app.

According to The Hollywood Reporter, Disney has also struck an agreement with UberUBER
which provides two free months with Disney+. Disney+ subscribers become members of Uber One, its loyalty program for up to six months.

Also, in July Verizon announced they would be offering Disney+ to prepaid customers for six months when they activate or upgrade to the more costly Prepaid Unlimited Plan. (Telecom rival T-Mobile has an agreement with their subscribers and Apple TV+.)

Paramount
PARA
: Paramount is another media company that is bundling is streaming properties. The Paramount-owned Showtime is bundled with Paramount+ at a monthly fee (with ads) of $11.99. The cost is only one dollar more than subscribing to just Showtime and a 25% discount from subscribing to both. There are rumors that the Showtime will soon migrate to the Paramount+ app.

Paramount recently struck an agreement with Walmart and its membership program for frequent shippers Walmart Plus. It was reported negotiations between Paramount and WalmartWMT
lasted over one year. Under the agreement Walmart Plus subscribers can get Paramount+ for free. Walmart would pay Paramount between $2 to $3 per subscriber per month for Paramount’s ad-supported plan. A monthly fee for an ad supported Paramount+ is $4.99.

Walmart had also been looking for a partnership with Disney and ComcastCMCSA
before striking a one-year exclusivity pact with Paramount. The cost of Walmart Plus remains at $98 a year and the program has an estimated 11 million members. Besides Paramount+, Walmart Plus users can also get a free six-month subscription to Spotify, a ten cent per gallon discount on participating gas stations and a $15 credit from Lyft.

Walmart continues to compete with AmazonAMZN
. Similar to Walmart Plus, Amazon Prime Video subscribers receive free shipping among other benefits. Also, Prime Video subscribers have the opportunity to bundle with AMC+ and Starz. The Wall Street Journal reports Costco has also been having talks with streaming services.

Moreover, last year Paramount+ announced a partnership with T-Mobile. New and existing T-Mobile and SprintS
customers on every postpaid consumer and home internet plan can get one full year of Paramount+ for free. (T-Mobile also has an agreement with their subscribers with Apple TV+.)

Comcast: Earlier this month the Comcast-owned Peacock announced an agreement with The Hallmark Channel. Under the deal, Peacock subscribers will be able to stream Hallmark’s Countdown to Christmas TV movies, 72 hours after their linear debut on Hallmark. (The movies will remain available on the cable network.)

Warner Bros. Discovery: With the Discovery-Warner Media merger complete, it was announced that streaming providers HBO Max and Discovery+ will be combined next summer. In addition, the new Warner Bros. Discovery will continue to bundle certain internet and wireless plans with AT&TT
. (AT&T had been the parent company of Warner Media.)

Google
GOOG
: Google’s YouTube along with Netflix is the most watched streaming provider launched Primetime Channels earlier this month. Primetime Channels is a video portal with access to 34 streaming services. YouTube users can access (rent or purchase) to various streaming options via its movies and TV hub.

Among the programming available include dozens of niche streamers as well as Paramount+, Showtime, Starz, AMC+, Epix, and ViX. YouTube plans to add further streaming providers including NBA League Pass. There was no announcement on whether the service comes with an option with no ads. Currently, the service is only available in the U.S.

Bundling as a source to grow revenue is not limited to streaming video. In its latest earnings report The New York TimesNYT
said it added 180,000 digital only subscribers. The Times had been looking to expand by bundling such content as Word games, cooking recipes, Wirecutter, a product review service and The Athletic, a sports news website.

Also, to grow revenue NPR recently launched a podcast bundle called NPR+. To access such popular programs as Fresh Air and Code Money with bonus material and ad-free content. Subscribers can pay $8 monthly or $96 annually to their local NPR station.

As media gets more competitive there will be more bundling opportunities. Cable television had the right idea.