Black Friday streaming returns despite lack of profits

The streaming business is at a turning point. Streaming services from major entertainment companies have collectively lost billions of dollars for years, and now their business owners are ready for them to cash in.

But that doesn’t stop them from offering steep, steep discounts to entice new subscribers for Black Friday.

It’s the essential Catch 22 of streaming: You have to bring new users into the fold, but you also have to make money from them.

And while streaming isn’t yet a profitable business (Disney and Max are certainly close), the stiff competition means they feel they still need to be aggressive when it comes to securing those subscribers.

With one exception of course: Neither Netflix, Amazon Prime Video nor Apple TV+ offer any discounts. If you’re already extremely profitable (like Netflix) or funded by a tech giant (Amazon and Apple), discounts, it seems, are unnecessary.

Disney is offering a number of Black Friday discounts, including a year of Hulu for $0.99 per month, or a year of the Disney Bundle of Disney+ and Hulu for $2.99 ​​per month. New Hulu subscribers can also add Starz as an add-on for $0.99 per month for a year (yes, Starz is available as an add-on to Hulu).

Disney, it’s worth noting, appears to be the entertainment company that has turned the corner in streaming, with its direct-to-consumer business delivering $321 million in net income in its fiscal Q4.

At NBCUniversal, Peacock offers a one-year subscription for $19.99 or six months of service for $1.99 per month.

At Paramount, despite the uncertainty surrounding Paramount+ with the looming Skydance takeover, the company is offering a discount, with both Paramount+ and Paramount+ with Showtime offering a $2.99 ​​per month deal for six months.

And Warner Bros. Discovery’s Max takes a similar approach, offering six months for $2.99 ​​per month. month.

There is, of course, a catch with the Black Friday deals.

With the exception of Paramount+ with Showtime, all deals involve their advertising tiers. This makes sense as the ad levels for many of these companies generate higher ARPU than the ad-free options. So even with the steep discounts, the companies have a way to try to make up for the lost subscription revenue, and if users stick around after the discounted rate ends, even better.

And Peacock, the streaming service that appears to be the furthest away from profitability (it lost just $436 million last quarter) is offering an annual plan to try to lock in users … and hope they tune in so they can monetize them through ads.

Streaming is a tough business. With the exception of Netflix, it is difficult to make a profit. But it seems that getting subscribers is even harder. So Black Friday sales are back and probably here to stay.