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A24 TECHNOLOGY
Saturday 2 November 2019
Freebies are the key hook in new 'streaming wars'

Even the dominant player
isn't immune. Netflix has
raised prices slowly, which
helped shield it from price
shock, but its latest small
increase has hurt customer
growth.
Westcott, the Deloitte con-
sultant, compared the
streaming promotions to ef-
forts to lure wireless custom-
ers from competing com-
panies.
T-Mobile has long offered
Netflix free to many cus-
tomers. Verizon includes six
free months of Apple Mu-
sic with some of its unlim-
ited plans. Many offer other
deals like paying off your
phone early or getting a
phone for free if you switch.
"They were constantly look-
ing for ways to steal you off
other players," he said.
How will these services
keep users once they've
reeled them in?
The companies can con-
stantly refresh their services
In this March 25, 2019, file photo Peter Stern, Apple Vice President of Services, speaks at the Steve Jobs Theater during an event to with new shows and mov-
announce new products in Cupertino, Calif. ies, Diffusion Group presi-
Associated Press dent Michael Greeson said.
By MAE ANDERSON blitzes and the promise of of any new iPhone, iPad, Comcast's Peacock ser- Cathy Yao, an analyst at
AP Technology Writer original shows and movies, Apple TV, Mac or iPod vice will be free for many Diamond Hill Capital Man-
If you make it free, will they then build a big enough Touch get a year for free. of its own cable and inter- agement, also said com-
come? library of old favorites to That suggests a market of net customers. The regu- panies can try to create
Apple, Disney and AT&T's help keep them. Already, 40 million customers, Wed- lar price hasn't been an- "stickiness" by bundling the
WarnerMedia want to HBO Max will have "Friends bush analyst Dan Ives said. nounced yet. The service services with other prod-
jump-start their challenges " exclusively, and Disney is Disney Plus, which arrives launches next spring. ucts and services so a cus-
to Netflix by offering free- taking back its older mov- Nov. 12, is also cheaper "I don't think customers are tomer is less inclined to un-
bies and deep discounts on ies from Netflix. than Netflix at $7 a month. going to have to make dif- subscribe.
emerging streaming plans. A lot of shows and mov- Disney struck a deal with ficult choices about cutting For example, including
That includes a free year of ies won't be available at Verizon to give custom- one in order to add an- HBO Max with wireless
Apple TV Plus for customers launch, but will be added ers of all unlimited wireless other for the first few years," and broadband services
of new Apple devices and over time. Free helps in the plans and some home- said MoffettNathanson Re- will make consumers more
a free year of Disney Plus to meantime. internet customers a free search's Craig Moffett. likely to stick around for all
higher-tier Verizon custom- Netflix has spent years year. Members of Disney's But companies can't run three, Yao said. It's simi-
ers. Some existing HBO sub- building up its 158 million free D23 fan club were also the services at a loss for- lar to how Amazon pack-
scribers will also get the su- subscribers worldwide. Hulu eligible to buy three years ever, and when discounts ages its streaming service
per-charged version, HBO has 28 million. The new of Disney Plus service up end and prices rise, cus- with its $119-a-year Prime
Max, at no additional cost. players want to ramp up front for the price of two tomers may flee. After all, loyalty program. Apple TV
Experts say these services subscribers quickly to show years. Disney is targeting 60 the services add up fast, Plus inked high-profile deals
can worry later about hold- they can compete. million to 90 million world- and signing up to multiple with Oprah Winfrey, Reese
ing onto customers — per- So the services have wide by 2024. ones could end up cost- Witherspoon and Jennifer
haps by offering must-see launched the digital equiv- AT&T's HBO Max, which ing as much as the cable Aniston. Comcast's NBCU-
shows they can't get any- alent of the old cable pro- launches in May for $15 a packages people are niversal reportedly paid
where else or tying dis- mos: lure you in with dis- month, is the most expen- ditching for streaming. $500 million to take back
counts to other services counted rates, then jack sive of the new services. There's a lesson to be drawn "The Office," and Netflix re-
that are difficult to drop. up the price after a year or That could make it tough from the latest TV-industry portedly paid even more
"Next year is a race to ag- two. But digital customers for AT&T to reach its goal attempt to counter cord- to claim global rights to
gregate consumers," said have more choices than of 50 million U.S. customers cutting. Cable-like online "Seinfeld." "The weapon
Kevin Westcott, who heads cable customers of yore so and 75 million to 90 million packages like Sling TV and of choice for retention is
Deloitte's U.S. telecommu- a big question is whether worldwide by 2025. YouTube TV have ended exclusive programming,"
nication, media and enter- they'll stick around. But AT&T will make the ser- discounts or raised prices, said Peter Csathy, founder
tainment consulting busi- Apple TV Plus debuts Fri- vice free for about 10 mil- causing customers to flee of Creatv and an industry
ness. "The first war is get- day for $5 a month with just lion existing HBO subscrib- and new sign-ups to slow consultant. "All of these be-
ting them to sign up for a nine shows and a few more ers, or about a third of its down. Sony announced hemoths are investing bil-
service. The second war is coming soon. It's already U.S. subscribers. HBO Max Tuesday that it will quit of- lions of dollars in originals
retaining them." cheaper than the $13 a will also be included with fering PlayStation Vue, one with the hope of finding the
The new services have to month Netflix charges for its AT&T's higher-tier wireless of the first to challenge tra- next 'Game of Thrones' that
attract users with marketing most popular plan. Buyers and broadband offerings. ditional TV packages. becomes 'Must See TV.'"q