Apple is reportedly exploring the possibility of bundling its streaming service AppleTV+ with Paramount+ to make both services more affordable. The discussions are still in the early stages and it's unclear what the bundled services will look like. According to people familiar with the matter, AppleTV+ and Paramount+ have higher-than-average customer churn rates, exceeding 7%.
It is understood that Paramount has previous experience in seeking partners in the field of streaming services. In 2022, the company partnered with Walmart (WMT) to offer Paramount+ as part of its Walmart+ offering, Walmart's take on Amazon Prime, which includes its own streaming service.
Currently, Apple has not disclosed the number of subscribers to AppleTV+. The platform provides multiple programs and movies including "for All Mankind", "CODA", and "Monarch: Legacy of Monsters".
Last month, Paramount revealed it had more than 63 million subscribers to its Paramount+ service, which includes shows and movies such as the "The Family" reboot, "Top Gun: Mavericks" and "Tulsa King." This figure follows the merger with the Showtime streaming service earlier this year.
In addition, the cost and profitability of the two companies' streaming services have also become concerns. Apple recently raised the monthly price of AppleTV+ to $9.99, while Paramount+ prices range from $5.99 to $11.99 depending on the plan. Last quarter, Paramount said its consumer losses shrank by more than 30%, mainly due to recent price increases and pay-per-view events.
Apple has not disclosed the profitability of AppleTV+, but it is part of its services segment along with other subscription services such as the App Store, advertising, and Apple Music. Last quarter, the segment's revenue hit $22.3 billion.
It’s worth mentioning that Verizon (VZ.US) is bundling Warner Bros. Discovery’s (WBD.US) ad-supported Max streaming service with Netflix (NFLX.US) for about $10 per month.
In addition, Disney (DIS) also bundles its three streaming services - Disney+, Hulu and ESPN+ - but they can also be purchased separately.