For years, Amazon has persuaded tens of millions of people to use its Prime Video app to subscribe to other services, such as HBO Max or Apple TV, and to watch shows such as The Pitt or Ted Lasso from within the retail giant’s digital walls.
Now, other streaming leaders are sprinting to catch up.
YouTube and Roku are racing to establish themselves in the US as one-stop shops for all the content people watch on their televisions. People who pay for a commercial-free YouTube tier, for example, will soon have access to Peacock content including The Traitors and Sunday Night Football as part of a recent deal between the two companies.
Netflix executives, who for years have blanched at the idea of collaborating with direct competitors, suddenly appear open to it.
In June, the company integrated a French broadcaster on to its platform, its first such move. And Netflix has had recent discussions about making other streaming services available as well, including Peacock and Fox One, according to three people familiar with the discussions.
The push underscores the competitive reality for the titans of streaming television. Companies that were once laser-focused on gaining new subscribers are now far more concerned with keeping those people watching as much as possible, and cancelling as little as possible.
The result is that the streaming wars of a few years ago have morphed into the bundling wars of today. The biggest streaming firms are no longer content to just have the most subscribers. They also want to be the main entry point to everything streaming has to offer.
“The thing that matters is that when you turn on the TV, what app are you opening for the next three hours?” said Jonathan Carson, the chief executive of Antenna, a subscription research firm.
Consumers are already showing enthusiasm for using one platform to manage their streaming subscriptions. Over the last three years, subscriptions made via third-party platforms like Amazon, Roku or YouTube have grown roughly 60 per cent, according to Antenna. About one-third of new subscriptions are now purchased this way.
Amazon, which has been in this business for several years, remains the runaway leader. As of June, Amazon had at least 49 million subscriptions for other services through Prime Video, Antenna said.
Roku is also increasingly persuading viewers to subscribe to outside streaming services through its “channels” feature within the Roku interface. The number of new subscriptions sold through its channels business rose 19 per cent in the second quarter of this year compared with last year, Antenna said.
Last month, YouTube struck a big, five-year deal to bring all of Peacock’s content to YouTube’s paid tier, called YouTube Premium. In the past, the service, which costs $16 (€14) a month, was aimed at the site’s power users. It offered a commercial-free experience and other perks, for music lovers in particular.
YouTube executives seem to believe that Peacock’s content will broaden appeal to its subscribers. Peacock’s programming includes Bravo reality series like the Real Housewives franchise and Love Island, as well as Saturday Night Live, Today, the Olympics, the National Football League and the National Basketball Association.
Peacock’s content will hit the premium tier early next year, and the price in the US will remain $16 a month.
YouTube also recently unveiled its first consumer marketing campaign for the premium subscription. The adverts will run on competitor streaming services – including Prime Video and HBO Max – and on popular podcasts such as Crime Junkie, Armchair Expert and The Daily, which is produced by The New York Times.
YouTube is also selling subscriptions for other streaming services through its Primetime Channels business. People can subscribe to and watch HBO Max, Fox One and Paramount+, among others, through the YouTube interface.
Netflix’s moves have been more subtle, but that could soon change. In June, the company began streaming a local broadcaster, TF1, in its French markets. That includes a live feed of TF1 networks and on-demand programs. Greg Peters, a co-chief executive at Netflix, described the early results of the TF1 pact as “very promising” in an earnings call last month.
He then strongly suggested that Netflix would be open to teaming up with others.
“If we see additional deals that similarly serve our members that work for our partner, that work for us, we’ll certainly consider them,” Peters said.
Netflix executives recently discussed bringing Peacock and Fox One to Netflix’s streaming service with NBCUniversal and the Fox Corp, the three people with knowledge of the discussions said. They added that there was no imminent deal to be announced, and that it was not yet clear whether Netflix would absorb the content into its own service, as in the YouTube-Peacock deal, or act more as a retailer in the mould of Amazon Prime Video.
But any move in that direction is a departure from what Netflix said just two years ago, when the company told shareholders that it “already operates as a go-to destination for entertainment”.
Not all companies are lining up to do business this way. Disney remains a holdout, selling a vast majority of its subscriptions directly to consumers. Paramount’s looming merger with Warner Bros Discovery could also change the distribution plans for Paramount+ and HBO Max; both distribute among third-party platforms.
There are significant trade-offs for companies that decide to distribute their content on platforms such as Amazon or YouTube. Those platforms can take a big cut of subscription and advertising revenue. A media company also generally loses access to a direct relationship with the consumer, since in these cases, that would be controlled by the platform.
Still, making such a move can defray tens of millions of dollars in technological and marketing expenses. It can also increase views.
“You’re either going to be a platform, or you’re going to distribute everywhere,” said Antenna executive Carson. “The moves over the last few months are starting to clarify that.” – This article originally appeared in The New York Times.
