Streaming services continue to proliferate, as does password sharing-for now
In an about face, Warner Bros. Discover has announced that it will not combine HBO Max with Discovery+ as they had previously stated. Instead, they will air most of Discovery+ content with people still being able to subscribe to Discovery+ as a stand-alone option. Discovery content that will be on both platforms include “Shark Week” and programs from Chip and Joanna Gaine’s Magnolia Network.
This makes more sense as Discovery+ currently has 20 million subscribers and getting them to make the move from a $4.99/month price point ($6.99/month without ads) to a much more expensive $9.99/month service ($15.99 with no ads) would be challenging.
That price differential is likely to grow larger once HBO Max brings its new app to market, as they are expected to raise the price point then. The company is also expected to launch a free ad supported TV channel later this year (FAST) which will include library content from the Warner Bros. studio as well as original content that ran on Discovery and HBO.
Clearly, there are too many streaming services on the market. According to S&P Global, there are almost 2,000 stand alone over-the-top OTT services. Many of them you have probably heard of (Amazon Prime Video, Apple TV, Disney+, ESPN+, HBO Max, Hulu, NetflixNFLX -4.2%, Paramount+, Peacock) and many of which you probably have not (Acorn TV, CrunchyRoll TV, Rakuten, etc.). This has caused consumer frustration as well as massive password sharing.
Netflix has already announced it would do a crackdown on file sharing this year, and The Wall Street Journal reported that it is implementing a monthly fee, initially in four countries (Canada, New Zealand, Spain and Portugal). In Canada it will charge C$7.99 per additional sharer (about $6), with a limit of two sharing plus the one who owns the account. This compares with its service with no ads that costs C$9.99.
Although Netflix does have a cheaper ad-supported service which costs C$5.99 per month, the company has chosen not to allow subscribers in the four countries announced so far not to share their account with anyone. The company will use network and device signals to determine whether or not the other user is part of that household. If not, the will be prompted to open their own account.
More countries will be hit with sharing surcharges later this year, although it’s unclear when this will be rolled out in the U.S. Forbes