Will Warner Bros. Discovery Follow Disney’s Lead On Bundling Programming?

There has been so much drama at CNN with Jeff Zucker, chmn. Of WarnerMedia news and sports as well as President of CNN, resigning 2/2 over an improper relationship with CNN chief marketing officer Allison Gollust (who was forced out shortly thereafter). But through it all, management has kept a stiff upper lip and gone on with business as usual for their new online venture CNN+.

But with the merger of WarnerMedia and Discovery Communications Inc. now just weeks away from closing (it will be renamed Warner Bros. Discovery), the company is reportedly taking a look at other options rather than the one Zucker had pushed for the CNN+ launch, a stand-alone paid service similar to Fox Nation (priced at $5.99/month or $64.99 per year).

There are dangers with this plan. There are currently so many OTT platforms out there that many consumers are tired of paying for multiple video services on top of their broadband bill. However, giving the channel away for free (as Comcast does with Peacock) makes it look like there are very few subscribers, something that Wall Street abhors.

And in the news genre, there are already so many free options, paying to get news will be a turn-off to some. Even Oprah Winfrey recently explored starting her own non-partisan news service, speaking with ex-Disney CEO Bob Iger, David Ellison (son of Oracle co-founder David Ellison) and other media big wigs. However, at this juncture, it doesn’t look like these talks have led to anything concrete.

One option the company is considering is combining CNN+ with HBO Max, although some analysts have complained that the HBO Max service is already too expensive compared to its competitors (HBO Max is on par with Netflix, both $9.99/month, although higher than Disney+ which is $7.99 a month).

Another option would be to mimic what Disney is doing (they have a bundle of Disney+, ESPN+ and Hulu for only $13.99 per month). Still, Warner Bros. Discovery would probably want to price such a bundle higher given the $9.99/month price point for HBO Max, Discovery+ is $4.99 for an ad-supported version and $6.99 for ad free. And on top of that they were seeking a monthly fee for CNN+ which would probably be on par with Fox Nation of $5.99/month. That would put it over $20 per month compared to the $13.99 Disney+, ESPN+ and Hulu bundle.

Bundling the three services together seems to be the most likely route for Warner Bros. Discovery to go. The trick will be to find a consumer price-point which is attractive and throwing a lot of marketing at the service at launch.