Disney+ Works to Retain Customers After Verizon Free Trial Ends

Disney+ Approaches its One Year Anniversary

Walt Disney Co.’s (DIS) streaming service Disney+, which launched in November of 2019, will face an important test next month. When Disney rolled out the platform, the company partnered with Verizon Communications (VZ) and gave all Verizon customers a free year-long Disney+ trial.

Starting on November 12 of this year, customers who received free access to Disney+ through their Verizon service will have three choices: they can pay $7 per month to keep their Disney+ membership, they can switch to a wireless plan that costs $80 or $90 per month and includes Disney+, ESPN+, and Hulu, or they can unsubscribe from Disney+. Disney, Verizon, and competitors are eager to see how customers respond.

A Win-Win Partnership

Both Disney and Verizon have benefited from the Disney+ partnership over the past year. Disney reported that about 20% of Disney+ customers joined the service through the Verizon deal during the first two months that Disney+ was available. This is equivalent to about 5.3 million customers. For context, the service added about 26 million subscribers during its first two months and then hit 60.5 million subscribers after nine months.

For Verizon, collaborating with Disney has been a helpful way to encourage customers to upgrade to its $80 per month unlimited data plan. As of June, Verizon reported that over 50% of its customers had unlimited data plans. This number was boosted by people wanting to watch Disney+ content using data.

Looking Ahead

As Disney+ approaches its one-year anniversary, the streaming platform has much to celebrate. Disney+ reached its original five-year subscription goal of 60 million customers in just nine months. As many of Disney’s other businesses such as theme parks and cruises have been battered by the COVID-19 pandemic, Disney+ has been a bright spot for the company.

Disney and Verizon are doing everything they can to retain Disney+ subscribers after the free trial expires on November 12. Currently, customers who are still in the free trial period can add ESPN+ and Hulu for just $6 per month. Disney+ is also launching new content, like The Mandalorian, a Star Wars TV series. The Mandalorian starts on October 30 and new episodes will come out each week, so customers will need to extend their subscriptions past November 12 to watch the full season.

A recent survey of Verizon and Disney+ customers showed that 44% of people plan to renew their subscriptions and 37% are undecided. Over the next three weeks, Verizon and Disney will be eager to see if they can find ways to retain those undecided customers and add new customers.

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