Verizon Communications says two-thirds of its customers who bought into its wireless service as part of a free year-long promotional deal from streamer Disney+ have stayed -- as paying customers.
“We think this is unheard of,” says Hans Vestberg, chairman-CEO of Verizon, speaking on CNBC, in regard to the over-delivered expectations.
“We are getting high-quality customers,” he says. “We will not have hundreds of these types of [streaming] agreements. We will have the absolute best ones. ... [As a result] our churn numbers at an all-time low.” Vestberg did not go into specific details.
In addition, he touts strong results from other deals with similar premium streaming services: Apple TV+ and Discovery+.
There was much analysis early on when Disney+ launched in November 2019 with the Verizon Media promotion. It was one of the first of the big free, year-long premium streaming services deal connected with a company’s communications service.
Analysts wondered what would happen after the deal ended for both businesses. After a little more than a year of operations, Disney+'s U.S. subscribers grew to an estimated 35 million by the end of 2020 -- from around 10 million at launch.
Verizon Wireless revenue grew 1.2% in the fourth quarter to $13.6 billion and slipped 0.3% for the 2020 year overall to $53.6 billion.
Verizon said its FiOS internet (broadband) service grew 5.1% in 2020 to 6.2 million subscribers. It added 92,000 subscribers in the fourth quarter of 2020, some 300,000 for the entire 2020 year.
On the flip side, the Verizon FiOS pay TV-video service lost 72,000 subscribers in fourth-quarter 2020. For the year, it sank 7.2% or 298,000 subscribers, versus a 225,000 decline in 2019 over the year before. The service now has 3.85 million subscribers.
The company says TV-video service losses “reflect the ongoing shift from traditional linear video to over-the-top offerings.”
Total FiOS revenue slipped 0.8% for 2020 to $11.1 billion for 2020, slipping 2.5% in the fourth quarter to $2.8 billion.