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Verizon looks set to keep investing in its wireless phone network via partnerships with major Hollywood players and content brands like Walt Disney and Discovery.
Ronan Dunne, executive vp and group CEO of Verizon Consumer, on Tuesday said offering initial free trials of Walt Disney’s Disney+ streaming service and now offering the just-launched Discovery+ for free was bolstering subscriber loyalty and retention among around 100 million wireless phone customers.
“We can leverage across the customer base for the advantage of both the customer, our partners and ultimately for our shareholders. So it’s a win-win and it’s working really, really well,” Dunne told the Citi 2021 Global TMT West Virtual Conference during a session that was webcast.
That customer acquisition and retention strategy has seen Verizon partner with content brands like Apple Music and Disney+, and now Discovery+, for initial free trial offers. Dunne also talked about how the phone giant is converting subscribers who have received Disney+ for free to paying customers after the one-year trial offer introduced in 2019 expires.
Verizon’s strategy has been to get its Disney+ subscribers to begin paying for the streaming service while also stepping up to unlimited wireless phone plans that bundle in ESPN+ and Hulu. “Customers get the intrinsic value of the Disney bundle, versus the price they pay. So 12 months free is free, but a $10 step-up gives you the opportunity to access a access a bundle that’s worth more than that,” Dunne argued.
Without being specific, Dunne added Disney’s latest bundle that includes Disney+, ESPN+ and a version of Hulu without commercials for $18.99 is available to Verizon at well below that base price. He also declined to give specifics on the number of Verizon Disney+ subscribers that have upgraded, and pointed only to “millions and millions of customers” as they also stepped up to more lucrative broadband connectivity plans.
Dunne argued Walt Disney, based on its recent analyst calls commentary, appeared satisfied with the Verizon model to retain Disney+ subscribers and sign up new ones. “Disney has been generous in their comments when they’ve reported as regards the significance of carrier partnerships built around the Verizon model,” he said, while pointing to additional carrier deals globally subsequently signed by the major studio.
And starting Jan. 4, Discovery launched its own streaming service, Discovery+, which costs viewers $4.99 a month (or $6.99 a month for no ads), with some Verizon customers getting the new direct-to-consumer offering 12 months for free. “Discovery+ I gather is No. 2 in our app store after our launch yesterday,” Dunne told the investors conference.
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