Discovery has relaunched ad-funded streaming service Dplay as Discovery+, with an additional paid tier affording on-demand access to its pay TV channels. Although it now shares a ‘Dis+’ with streaming behemoth Disney+, it will have to tread a dramatically different path to sustainable growth.
Discovery has joined the streaming party. It's now in good company among pluses: there's Disney+, Apple TV Plus, ESPN Plus, Hulu Plus, Samsung TV Plus, BET Plus and Paramount Plus.
James Gibbons, Discovery’s executive vice president general manager UK & Nordics, admits that the ‘+’ has “become synonymous with streaming services thanks to Disney+”. As a shorthand for streaming, it’s more navigable than the sludge of acronyms like SVOD, VOD, AVOD, OTT, and BVOD.
He adds: “+ also indicates to consumers that there's a broader offering. Ours includes our flagship brand Discovery Channel and 12 other channels, plus discovery+ Originals, box sets and curated collections.”
During its first year of life, Dplay offered ad-funded catch-up of linear channels like Quest, Really, Quest Red, DMAX, Food Network. Discovery+ opens up a VOD library that includes pay TV channels too, as well as upcoming originals that lean heavily on crime documentaries and supernatural-themed content.
The channel launches with 80 hours of originals. Originals include an attempt to recreate Netflix’s Tiger King magic with a documentary about Joe Exotic’s zoo; there is also a Ghost Adventures special at the site. The Osbourne family, no strangers to reality TV, also have a ghost hunting vehicle, The Osbournes: Night of Terror.
To promote this is Discovery’s biggest-ever UK above the line campaign. It calls for “thrillseekers, trailblazers, home improvers, treasure hunters and foodies, petrol heads, ghost hunters and nature lovers”.
It’s bringing its format-driven, unscripted shows to streaming, accounting for every niche imaginable.
Gibbons isn’t to be drawn into talk of competition, arguing that Discovery sits on a different tier from the likes of Netflix. “Discovery+ will complement rather than compete with the streaming services already available in the market.”
The viewing hours that Netflix owns aren’t going anywhere, then. But Discovery is trying to own the rest of the time the TV is on. The point of friction will be whether people will pay the £4.99 a month to access, or £29.99 annually. They can try a free two-week free trial, though and around 4.3m Sky Q customers can sign up to it for free for 12 months, where it will sit aside Disney+ and Netflix.
Gibbons says Discovery+ is for “fans of real-life entertainment” – its programming purposefully delves into many passion points. The marketing campaign, ’Stream What You Love’, ought to reach around 96% of the UK adult population across TV, VOD, radio, out of home, transit and more.
Meanwhile, on the Sky platform, the focus will be in turning visibility into subscriptions. To further incentivise them, it is giving away gold bars on the Sky VIP loyalty programme, bolstered by a promotion on Chris Evans’ breakfast radio show.
Who is it for?
Discovery's portfolio accounts for 8.5% of all commercial viewing in the UK – with a 50/50 male-female split. It aims to grow the core audience and drive the heaviest viewers into a direct paid relationship. The hope is to skew a bit younger in digital, too.
“We already know viewing performance is also a consequence of the platform, not the content itself. For example, our TLC content skews much younger on digital. He points to Say Yes To The Dress, one of its most popular franchises on TLC, which has been hitting nearly 1bn views across its UK social channels. The originals are being commissioned with this in mind too.
The evolution of Dplay now serves “all ends of the market” says Gibbons. They will hope that the AVOD service can funnel users into the paid-for offering. It’s not a “knee jerk reaction… our business model now encompasses direct-to-consumer, affiliate and ad sales.”
Now it is a game of scale. Gibbons fancies his chances in hitting targets claiming: “We have the third-largest content library of any streaming service at the moment and the second largest for unscripted.”
Can it work?
Tom Harrington, senior research analyst at Enders Analysis, noted that the service is integrated with around 4.3m Sky Q boxes, which comprises just almost all Sky TV subscribers.
Integration of Netflix and later Disney+ in 2020 into Sky Q indicates that it is a keen platform to drive SVOD subscriptions. Enders Notes that the Sky Q is a platform more tailored to on-demand viewing than previous Sky+ boxes.
Harrington notes that if services outside of Netflix or Disney+ will find it “pretty hard“. He attributes this to streaming services being siloed services, as opposed to linear channels that you can flick between. Smaller services may “find it difficult to get traction, which is why Discovery+ is being given away for free [for a year] on Sky Q to people who’ve shown they are willing to pay a bit more for TV.”
”Of the 4.3m, who knows how many people will actually sign up to it?” It currently has pride of place on the Sky Q app and could sit next to the high-traffic Disney+ app, which could provide additional uplift – or serve as a stark comparison.
For Harrington, the navigation’s not quite as smooth as it could be on the likes of Sky Q. He has a hunch that Sky likes having these apps in its ecosystem as a selling point but would ultimately rather have customers binge on its own boxsets. Shows aren’t particularly discoverable in the search bar, he notes.
Sky’s always been a gatekeeper to content, but it also sits on the means of delivery with its broadband business. It will always need to remind subscribers of that, especially those considering cutting the cord.
Whether Discovery+ immediately hits the spot or not, the content giant had to make the move. There are lessons to learn from its sister app, Eurosport Player.
But SVOD doesn‘t offer additional profit, and there are inherent costs. The likes of Man Vs Food could have been sold to another player, instead of having its home on Discovery+. That revenue stream is now sunk into its owned platform in the UK. And then there are the cost of deals to ensure visibility on platforms like Sky Q, as well as what Discovery described as its biggest ever ATL marketing campaign
Harrington ends on a sour note: “Everyone’s restructuring around streaming, whether it is the BBC, ITV, NBC Universal and even Disney. Not every streamer will survive.”
Many providers will find the leap from a series of linear channels to a streaming ecosystem difficult if done in isolation. But this‘ll play out on a broader scale. Gibbons hints to expect subsequent Discovery+ launches before the end of 2020. Internationally, it has the BBC's wildlife portfolio in its grasp, which could add a substantial heft to the offering.