As Netflix adds 5 million subscribers in its third quarter, the streaming giant took a shot at its competitors’ bundling plans, saying their counterparts “lack [their] breadth of content.”
“Programming for such a large, engaged audience, with so much variety and great quality, is hard,” the streamer wrote in its third quarter earnings report to shareholders Thursday. “It’s why streaming services which lack our breadth of content are increasingly looking to bundle their offerings (selling and discounting their services together, channel offerings, etc.).”
By contrast, Netflix noted it already offers “an extraordinary package of series and films (licensed and original), and increasingly games and live events — all in one place and for one price, easy to use and great value for money.”
Netflix co-CEO Ted Sarandos added during the Q3 earnings call that bundling can be a “comfortable business model for legacy media companies,” but isn’t an attractive way for Netflix to grow its business.
“Given the narrow scope of the libraries on the services and the fairly limited engagement, it makes sense for them to kind of replicate some of the older media models of kind of creating these bundles, but we’re focused on … adding more and more value to this package, amazing series and films and now games at a remarkably low price, all in one place,” Sarandos said.
Even so, the streamer admitted their 2024 programming slate “has been patchier than normal due to last year’s strikes,” but added that their “volume has
picked up again,” pointing to recent hits like Nicole Kidman’s “The Perfect Couple,” Ryan Murphy’s “Monsters: The Lyle and Erik Menendez Story” and the Kristen Bell and Adam Brody-led “Nobody Wants This.”
The streamer’s output will be “largely back to normal” in 2025, Sarandos said during the earnings call, adding that while neither TV nor film have “fully recovered” yet, “we’re moving closer and closer to more normalized output.”
Last week, Prime Video and Amazon MGM Studios head Mike Hopkins announced that Prime Video would start offering its viewers the ability to subscribe to Apple TV+ directly through its app for $9.99 per month. Together, the bundle will “[give] viewers an incredible breadth of viewing options,” per Apple’s SVP of services Eddy Cue.
Netflix has stayed strong on its stance to avoid bundling plans, most recently clarifying that its slate’s breadth and variety “limits the benefit” of being bundled with content from other streamers.
“We haven’t bundled Netflix solely with other streamers like Disney+ or Max because Netflix already operates as a go-to destination for entertainment thanks to the breadth and variety of our slate and superior product experience,” the streamer’s Q2 earnings statement read. “This has driven industry leading penetration, engagement and retention for us, which limits the benefit to Netflix of bundling directly with other streamers.”
In addition to adding 5.07 million subscribers in the third quarter of 2024 — which is up 14.4% to total 282.72 million globally — Netflix brought in $9.83 billion in Q3, up 15% when compared to year-over-year revenue.
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