Streaming service bundling was probably inevitable, as bundling of products has been a staple of the consumer content and communications business for some decades. Lower marketing costs, higher perceived value, lower churn and perceived distinctiveness are some of the advantages.
Bundling also makes price comparisons more difficult, as the retail price for the bundle obscures the actual “price” for any single bundle component. That becomes more obvious as disparate services or products are added to any bundle.
Some decades ago bundling sometimes was described as having value because it simplified the customer billing interaction. Most of us would have a hard time identifying that as a value which is relevant to most--if not all--buyers.
In almost all cases, price discounts are the attraction of a bundle.
For some content owners, discounted offers for purchases of multiple owned steaming services is something of a no-brainer.
Bundling of streaming services with other products such as a mobile subscription also has become common. The point has been to create differentiation in a crowded marketplace by adding value beyond content access.
The other new trend in the U.S. streaming business is multi-sided revenue models, particularly using advertising in addition to subscription fees paid by end users. By effectively lowering price points, demand is stimulated.
As linear content services always have been about bundles, now streaming will do the same, perhaps eventually creating bundles of bundles. The trade off, as always, will be higher volume at the cost of lower profit margins per unit.
No comments:
Post a Comment