New streaming services tend to turn heads in the media. Disney+ became the most-discussed streamer in the business when it launched in late 2019. Apple TV+, which launched around the same time, is continuing to make headlines due to partnerships with household names such as Tom Hanks and Martin Scorsese. Last year, entertainment conglomerates Comcast and AT&T rolled out Peacock and HBO Max, respectively, and each boasted large catalogues of iconic films and television shows. Quibi came and went.
And then there’s Discovery+, which launched in the United States on January 4. Discovery+ hasn’t made waves in entertainment news like its nascent contemporaries and it doesn’t have a show as universally recognized as “The Mandalorian.” But that’s not to say the streaming service’s launch fell on deaf ears, and it certainly doesn’t say anything about the popularity of its content.
Discovery+ boasts a mix of original programming and library content, and the platform’s offerings are immense. Discovery+ launched with 55,000 episodes of programming, including a variety of popular shows ranging from “Diners, Drive-Ins, and Dives” to the various “90 Day Fiancé” shows and other iconic brands that have been television mainstays for years. The content is entirely unlike the glitzy and award-friendly shows and films that helped streamers like Netflix and Disney+ dominate the market — but that disparity is one of Discovery+’s greatest strengths, according to analysts.
The major streamers in the business tend to directly compete with one another for subscribers, which is reflected in the kinds of content they prioritize; scripted dramas and comedies, as well as action shows are the norm on platforms such as Netflix and Hulu. Food programming and reality television are immensely popular genres that have been relatively unexplored on major streamers, and according to Mark Zgutowicz, a senior analyst at Rosenblatt Securities, Discovery’s grip on those kinds of shows across its brands makes Discovery+ well-situated to thrive in the streaming industry.
“If you look at the top primetime cable networks, Discovery has several of the top channels in HGTV, TLC, the Discovery Channel, Food Network, and Investigative Discovery,” Zgutowicz said. “They have premiere channels and very differentiated content among unique brands, which gives Discovery+ the ability to be a complement to other streamers, but the question is what the right price point is.”
A subscription to the ad-supported version of Discovery+ costs $4.99 per month, while a subscription to the ad-free tier runs for $6.99 per month. A subscription to either version of Discovery+ is cheaper than the standard subscriptions for any of the industry’s major streaming services and comparable to other streamers that cater to more niche audiences, such as the horror-focused Shudder ($4.75 per month) and Acorn TV ($5.99 per month), which offers programming from the United Kingdom.
Discovery stated in February that it had surpassed 11 million streaming subscribers across its various brands. Though the company said that most of its recent gains were U.S.-based Discovery+ subscribers, the company has yet to specify exactly how many subscribers Discovery+ has. Discovery representatives declined to comment for this story.
Regardless, Discovery+ has avoided some of the pitfalls that plagued other recently launched streamers. Discovery+ was available on Roku and Amazon Fire TV, the streaming industry’s most popular connected TV devices, at launch. Those devices are considerably popular among consumers, and it’s critical for streaming services to be available on such devices to to expand their reach; Peacock and HBO Max were unavailable on both devices until months after their launches and analysts told IndieWire in 2020 that that issue was partially to blame for HBO Max’s slow start.
Discovery+ also boasts a generous promotional offer for would-be subscribers: Select Verizon customers can get a free year of the streaming service, which was also the case with Disney+ in 2019. Doug Clinton, managing partner of tech VC fund Loup Ventures, noted that lengthy promotional deals have been proven to boost interest in new streaming services, but noted that Discovery would need to effectively market the platform to ensure user retention in the months and years ahead.
“Promotions, like Discovery+ and Verizon, have become the industry consensus when you start these streaming service,” Clinton said. “Every new streaming service has some sort of promo to get people hooked, but you ultimately need some sort of core content to resonate with an audience. There’s an opportunity for Discovery to leverage the stars of their reality-focused content slate and their social media influence, but Discovery doesn’t have as strong of a brand as Disney does with ‘Star Wars’ and Marvel. They’ll definitely need to invest more into marketing than what we’ve seen.”
While it will take months to determine whether Discovery+ can retain the early adopters and promotional users who have engaged with the platform — or court cord cutters who used to enjoy channels such as HGTV and Food Network — there’s no doubting the power behind the shows and personalities that make up Discovery+’s most well-known content. Zgutowicz noted that it was critical for Discovery+ to entrench itself in the United States but added that the streaming service has already enjoyed a solid start in overseas markets.
“Two-thirds of their subscriber base is outside the United States,” Zgutowicz said. “They have a lot of really solid local language content, particularly on the sports side. They also have the Olympics broadcasting rights in Europe through 2024, which is important in terms of their potential subscriber gains with Discovery+ later in the year. At the same time, the United States is where the money is for premium ad dollars, so they do need to build up the subscriber base in the United States.”