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Discovery+ Streaming Platform Could Win Big With Strong Brand, Content Library

Chris Katje
·3 min read

Discovery Communications (NASDAQ: DISCA) unveiled a direct-to-consumer streaming offering Wednesday. 

What Happened: The streaming platform from Discovery will launch in the U.S. on Jan. 4, with price points of $4.99 per month or $6.99 per month for an ad-free version.

Discovery+ will launch initially in 25 countries, with plans for more to be added later. 

“With discovery+, we are seizing the global opportunity to be the world’s definitive product for unscripted storytelling,” Discovery CEO David Zaslav said in a statement. 

Earlier this year, Zaslav said a streaming offering from Discovery would be the “SUV of brands” compared to the sports cars of Disney and Netflix Inc (NASDAQ: NFLX).

Verizon Communications (NYSE: VZ) is a launch partner in the United States and will offer customers of its Play More or Get More unlimited plan 12 months of discovery+ free. Sky will partner with Discovery for a similar offering for its customers in Europe.

Related Link: Apple, Verizon Join Hands To Encourage Enterprise Upgrade To 5G, iPhone12

Why It’s Important: The streaming platform is bringing a huge library of content from existing and new shows, including some new exclusives for discovery+.

The company said this is the largest-ever content offering for a new streaming service in the U.S.

Discovery+ will have over 55,000 episodes from over 2,500 shows in the U.S. This includes shows from popular channels like HGTV, TLC, Food Network, ID, OWN, Travel Channel, Discovery and Animal Planet.

Exclusive originals will come from notable names like Chip and Joanna Gaines, Sir David Attenborough, David Schwimmer, Kevin Hart and Bobby Flay.

The streaming platform will provide a first look at content from The Magnolia Network, a joint venture between the Gaines and Discovery. Several new shows will launch on this channel and get their start on the streaming platform exclusively until the channel’s 2021 launch.

The “90 Day Fiancee” franchise will move to the streaming platform with new spinoff shows planned.

In Europe, discovery+ will be the streaming home of Olympic Games coverage thanks to Discovery’s rights ownership.

The partnership with Verizon is similar to deals that were done with Walt Disney Co's (NYSE: DIS) streaming platform Disney+ at launch.

Benzinga’s Take: In August, I highlighted the possible launch of a DTC offering from Discovery — it could be a big winner for the company.

In the second quarter, Discovery-owned channels HGTV, TLC, Discovery and Food were four of the top 10 pay channels for women in prime time. Discovery has a 20% market share for this demographic.

TLC ratings hit an all-time high in the second quarter and the other channels continue to outperform competitors thanks to loyal fans.

The price point and huge content offering could make this a winning streaming play and boost Discovery's share price. 

DISCA Price Action: Shares of Discovery were up 2.02% at $28.24 ahead of the close Wednesday. 

Shares are down over 15% year-to-date.

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