New Bundles Point to Broadband’s Growing Power in SVOD Packaging
With the proliferation of new streaming bundles announced recently, it’s understandable that one of them all but slipped through the cracks. Paramount Global’s new deal with Charter Communications, which will package SVODs Paramount+ and BET+ with the cable provider’s Spectrum TV service, was announced last month to little comment beyond obligatory reports.
This was likely partly because a deal was reached without an acrimonious channel blackout and partly because Charter struck a nearly identical pact with Disney a mere eight months earlier (and because, frankly, the negotiations were far from the most dramatic thing going on at Paramount over the past month).
But the Paramount-Charter deal becomes more significant when viewed in the broader context of the shifting SVOD bundle landscape.
It may not be immediately obvious, but the companies’ pact has much in common with Comcast’s recently launched StreamSaver offer, which includes the ad-supported versions of Netflix and Peacock alongside Apple TV+. The similarity becomes more apparent when one realizes StreamSaver’s catch: The package is available only to Comcast’s Xfinity broadband and cable subscribers (for the low, low price of an extra $15 per month).
Taken together, these deals make it clear that telecom companies, specifically pay TV and internet providers, are expanding their presence as streaming bundlers and aggregators, as VIP+ previously predicted they would.
Certain Spectrum TV packages will now carry both Paramount and Disney streaming services, integrating multiple SVODs into the cable bundle they’ve been steadily replacing. It remains unlikely that this practice will reverse the tide of cord-cutting — particularly as more and more core linear TV content, including sports, becomes increasingly available via streaming — but it could help carve out a new relevance for telecoms as SVOD marketplaces, à la Amazon’s Prime Video Channels.
Progress toward this new status quo is already in motion. An additional provision in the Charter-Paramount deal specifies the telecom “will leverage its vast distribution capabilities” to offer Paramount’s streaming services to its internet customers “for purchase at retail rates, with revenue share to Charter for new paid subscriptions and ad-free upgrades.”
Charter has the same arrangement with Disney, and although revenue-sharing terms were not disclosed in the announcement of the Mouse House’s deal, Charter is likely taking a portion of those sales as well. In other words, the telecom is already positioning itself to aggregate streaming subscriptions through its broadband service.
The move echoes what cellular companies have been doing for years and what Verizon in particular has been pursuing aggressively with its +play marketplace. When the telco announced a Netflix-Max bundle for its wireless customers last year, media industry commentator Evan Shapiro described it as Verizon “bundling more and more entertainment services into … the only must-have service for the majority of humans on earth.”
If mobile phone service is the number one must-have service for most of humanity, broadband access has to be number two. More broadband-SVOD bundles are likely not far behind, therefore, as more internet providers are sure to realize they can seize upon their service’s ubiquity to help media companies sell their streaming products.
The majority of the benefits here, of course, will go to the broadband companies, as they open new revenue streams through those sharing arrangements that will help offset their own slowing subscriber growth.
But given media companies’ current desperation to expand their streaming revenues and reduce user churn, they’ll likely get on board with these arrangements however lopsided they are. At least Paramount, unlike Disney, got to keep all its linear networks on Spectrum.
