Report: ~70% of Showtime & STARZ Subscribers Billed By Amazon, As HBO Max Reduces Reliance on Prime Video
For SVOD services, being available through third-party channel stores like Prime Video Channels is a blessing and curse. It brings significant distribution to the service, that otherwise might not have been reachable without – but it comes at a cost.
It has been reported that Amazon keeps 30% of subscription revenue every month, which makes it an expensive channel of distribution. In 2018, TDG estimated that over 50% of HBO’s direct-to-consumer subscribers came from Amazon Channels.
A recent report by ANTENNA compared the split of subscribers being billed directly by a streaming service, through Amazon, and Apple. In both 2019 to 2020, SHOWTIME and STARZ saw over 70% of their billing relationships through Amazon and Apple.
In May, Amazon reported that nearly 5 million HBO customers received their HBO programming through HBO Max. However, after a carriage dispute, HBO Max came to Fire TV and Prime Video Channels in December, but with the agreement that it will no longer be offered by Prime Video Channels at some point in 2021.
From December 2019 to 2020, HBO Max already saw subscribers via Amazon dip from 60% to 40% – as customers shifted to direct billing to access the additional HBO Max content. There were also incentives to switch with a 20% discount for six months for those who signed up directly with HBO.
The report compares December ‘19 numbers to those report in December ‘20, showing that Apple and Amazon combine to own the billing relationship for over 70 percent of SHOWTIME & STARZ subscribers, and about 1 in 5 Premium SVOD Subscriptions by December 2020.
While heavy-hitters like Netflix, Hulu, and to a lesser extent Disney+ generally have viewers subscribe through their platform, services like HBO Max, Starz, and Showtime seem to thrive on third-party distribution. You can view the entire breakdown below:
We can see that Netflix and Hulu own all of their subscriber base, as the companies don’t offer the ability to sign-up anywhere but directly on their website. Netflix stopped iTunes billing at the end of 2018. Disney+ isn’t available as part of Prime Video Channels, but you can pay for the service directly through Apple and Amazon. Nearly 75% of subscribers though come directly from the service.
CBS All Access (now Paramount+) lost direct subscribers to both Apple and Amazon. In August 2020, they began offering a bundle with Apple TV+ that included Showtime and CBS All Access at a substantial discount.
In total, Apple and Amazon billed 1 in 5 premium SVOD subscribers in December 2020, and 1 in 3 if you exclude Netflix, says ANTENNA.
Going forward, the biggest of services will likely focus primarily on direct billing consumers. Most recently release services like Disney+, Peacock, HBO Max have focused on owning the customer completely. However, in January discovery+ said that they will be bringing the service to Prime Video Channels later this year.