Verizon wireless customers get a Mickey Mouse-tinged treat for the next year: free access to Disney’s new Disney+ video service.
The partnership could help both parties, by giving Verizon customers another reason not to defect to rivals and generating a huge initial audience for Disney’s brand new service as it tries to compete with Netflix, Amazon, and other established players. Disney is charging $7 per month for its new service, which kicks off on Nov. 12 and will have movies and shows from its vast library including the Star Wars, Pixar, and Marvel brands.
The 12-month free offer will be available to all Verizon unlimited wireless customers as well as to new subscribers of Verizon’s nascent wireless 5G home Internet and Fios Internet services. Customers will be able to watch on up to four devices at once, download content for offline viewing, and set up multiple viewing profiles, the companies said. Verizon had almost 94 million consumer wireless connections at the end of June, though not all are on an unlimited plan.
About 17 million households on unlimited plans would qualify for the free Disney+ offer, analyst John Hodulik at UBS estimated. “High quality content bundling should help drive gross adds and lower churn while encouraging migration to higher-priced unlimited plans,” he wrote in a report on Tuesday. “We see this move as the latest of Verizon’s recent moves focusing on market share gains.”
The new offer could be a real treat for some Verizon customers who also favor the iPhone. Apple has said it would give a free one year subscription to its upcoming Apple TV+ streaming service to anyone who buys a new iPhone 11. So a Verizon unlimited wireless customer who buys a new iPhone could get both Disney and Apple’s video plans for free. That’s a $144 savings.
Competition in the wireless market has settled down over the past year after heating up in 2016 and 2017 when Verizon and its rivals AT&T, Sprint and T-Mobile all shifted to offering cheaper unlimited data plans. Now the carriers are focusing on content partnerships. Verizon already offers some subscribers free Apple Music subscriptions, while T-Mobile has a Netflix deal and Sprint offers customers Hulu. And AT&T bought Time Warner in part to offer its wireless subscribers more free programming.
Verizon’s strategy is to offer “the best premium content available through key partnerships,” CEO Hans Vestberg said in a statement. That’s a different approach than rival AT&T, which spent $108 billion buying Time Warner to own more content.
Meanwhile, Disney is fighting to remain relevant as viewership shifts away from traditional TV and cable services to online and mobile alternatives. The Disney+ service faces a crowded market, led by Netflix, but also with other new players like Apple, Comcast, and AT&T entering, as well.
Disney’s stock price jumped 2% after the announcement, while Verizon shares were about unchanged.
(This story was updated on Oct. 22 to add an analyst comment.)
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