Apple and Paramount are reportedly discussing the possibility of bundling their streaming services at a discounted price. This might be an effort to attract more customers in the face of intense competition from companies like Netflix, Disney+, and Prime Video, according to the New York Post.
Those familiar with the matter informed The Wall Street Journal (WSJ) that the two entertainment competitors have discussed the idea of merging their respective subscription systems, AppleTV+ and Paramount+, into a single, more affordable package.
The Effort to Increase Subscriptions
Signups for AppleTV+ in the United States increased sharply to around 60,000 per day after the much-anticipated Tom Hanks' World War II film, titled Greyhound, premiered on July 10, 2020. According to statistics from subscriber-measurement firm Antenna, there were just 8,500 new customers the day before. The number of new AppleTV+ signups dropped back down to about 10,000 per day the next week.
More than 7% of AppleTV+ and Paramount+ subscribers canceled their service in October, a "churn" rate that is common in the business world.
Based on statistics from Antenna, the amount exceeded the 5.1% churn rate for the whole streaming market last month, as reported by WSJ.
Apple said the price increase represents its commitment to bringing higher-quality content and services to AppleTV+, but the decision actually led to a decline in the platform's user base. Late in October, Apple TV+'s monthly fee increased by $3 to $9.99.
Earlier this year, in response to lower-than-expected first-quarter results, Paramount increased its streaming fees, as well. The Essential tier of Paramount+ is currently $5.99, $1 higher than it was at the beginning of 2023, while the Premium tier, which includes Showtime material and is ad-free, is $11.99.
In the Highly Competitive Market
In an effort to increase growth in the face of fierce competition, streaming titans Disney and Netflix recently increased rates.
A collaboration like the one anticipated between Apple and Paramount was formed earlier this month when Verizon inked a deal with Netflix and another prominent streamer, Max, to create a package.
Verizon is reportedly aiming to provide the ad-supported versions of Netflix and Warner Bros Discovery's Max streaming services for about $10 per month instead of roughly $17 per month. This is all part of the arrangement.
While the exact financial terms were not disclosed, Verizon would reportedly be receiving a portion of the profits made by Netflix and Warner Bros. Regardless, the news comes as some relief to the entertainment giants.
On the other hand, Netflix is anticipated to raise costs for its premium ad-free tier to attract more customers to the ad-supported tier, which generates more income per user, after launching it late last year. Previously, the firm restricted password-sharing outside of homes to reach the over 100 million users who use the service. The ad-supported basic plan starts at $6.99 per month, while the ad-free subscriptions begin at $15.49 per month.
