On Thursday, DirecTV’s parent company AT&T reported that its subsidiary lost a staggering 946,000 subscribers in the second quarter of this year. In Q1 2019, the entire paid television sector only lost around 1 million customers. Also, the telecommunications company stated that its DirecTV Now streaming television service lost 168,000 subscribers.
The corporation attributed the staggering declines in its pay-TV segments to recent price increases. Admittedly, even streaming video companies like Netflix have experienced significant losses when they’ve raised prices. But in DirecTV’s case, the provider has been the victim of the recent surge in cord-cutting among American consumers. Indeed, 627,000 people canceled the satellite provider’s services in Q1 2019.
However, while AT&T will continue to see significant drops in its DirecTV segment, it doesn’t plan on sitting out the streaming war. Earlier this month the conglomerate’s WarnerMedia division announced it would launch a new streaming video on demand (SVO D) service called HBO Max in the spring of 2020.
At launch, AT&T’s new platform will feature more than 10,000 hours of content, including the enduringly popular “Friends.” On Wednesday, WarnerMedia announced adding live sports and news are on the HBO Max roadmap. As such, it’s not inconceivable that AT&T will discontinue its DirecTV products if it’s new SVOD becomes a hit.
But the corporation will need a strong pricing and content strategy to compete with the host of streaming services launching next year.
New NBCUniversal SVOD Details Released
On Wednesday, NBCUniversal CEO Steve Burke revealed new information regarding the corporation’s forthcoming SVOD service. The new platform will officially launch First off, the new platform will launch in April 2020. The executive also noted the unnamed service would be available in both ad-supported and ad-free variations.
Furthermore, Burke said the platform’s core appeal would be its library of legacy content, most of which will be from outside producers. In June, the entertainment conglomerate announced it reacquired rights to “The Office,” and the SVOD will be its exclusive home starting in January 2021. Indeed, despite ending its run in 2013, the workplace sitcom represents five percent of Netflix’s streaming volume.
Critically praised but under viewed comedy “A.P. Bio” will debut its third season on the streaming service.
While being the only service to stream “The Office” holds obvious consumer appeal, NBCUniversal’s SVOD will need a more content stand out in a landscape that will include streaming services from Apple and Disney. Furthermore, even with Dunder-Mifflin crew on tap, the company’s subscription offering might be overshadowed by a rejuvenated Hulu.
Hulu is Going After Netflix’s Crown
Though Netflix is the current king, the American streaming industry, one of its biggest competitors may take its crown in the next two years. However, in spite of their backing from legacy media companies and tech giants, the biggest threat to its dominance isn’t Apple Plus, Disney Plus, HBO Max, or NBCUniversal.
In May, the Walt Disney Corporation took control of the SVOD after completing its purchase of Fox’s media assets. Since then, the conglomerate has quietly been beefing up Hulu’s content offerings.
During the 2019 San Diego Comic-Con, the SVOD premiered the fourth season of cult detective show “Veronica Mars.” In September, the platform will debut a new drama chronicling the rise of the Wu-Tang Clan rap group. Furthermore, Hulu will serve as the new home of Fox’s sci-fi comedy “The Orville” when it returns next year.
Most prominently, Hulu will also host a range of Disney-owned content that is too mature for Disney Plus. In 2020, gritty Marvel Studios shows “Ghost Rider” and “Hellstorm” will debut on the SVOD. The platform will offer a series of adult animated series featuring D-List Marvel Comics characters.
Besides, Disney is shutting down FX’s streaming service in August and will migrate its content to Hulu.
With all that diverse premium content, Hulu is being positioned as a real rival for Netflix. Admittedly, the Disney subsidiary only has 28 million subscribers compared to the Redding, California-based streaming giant’s 60 million. But Hulu is growing at an impressive rate. As of May, it added 3.8 million domestic subscribers to Netflix’s 1.4 million this year.
How Disney Wins the War
The House of Mouse is building up Hulu as one part of a tripartite strategy to win the streaming war. It’s Disney Plus service will host its mainline Marvel content, Disney classics, and Pixar movies. Furthermore, it’s ESPN Plus service will host a vast reservoir of sports content. Lastly, Hulu will offer live TV streaming, a selection of Fox produced movies and TV shows, and assorted acquired content.
Notably, Disney plans to offer a monthly subscription package that features all three SVODs.
On Wednesday, the Hollywood Reporter published the findings of a streaming video consumer study. The publication noted the average American is okay with paying for multiple SVOD services, provided they fall within a range of $17-$27. Currently, commercial-free Hulu costs $11.99 a month; ESPN+ is $4.99, and Disney Plus will be available for $6.99.
If Disney offers its streaming service package at a nice round double-digit number, it will become the market leader of the American streaming video industry. And judging by DirecTV’s recent losses, it’ll do so while ushering in the end of the pay-TV era.