Technology

Cord Cutters Love to Watch, Until the Free Trials Expire

Streaming giants are struggling with a big churn conundrum: Only a third of users stick around.

Illustration: Joel Plosz for Bloomberg Businessweek

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By Christopher Palmeri

December 13, 2019 at 11:00 AM UTC

This article is for subscribers only.

This article is part of the December 16, 2019 issue of businessweek.

Walt Disney Co.’s new streaming service, Disney+, signed up 10 million customers last month, well ahead of expectations. And it’s got a buzzy show with the Star Wars spinoff The Mandalorian. Now the world’s largest entertainment company has to figure out how to keep people from canceling the service after that series’ season finale on Dec. 27 or when their free trials expire.

Everyone wants to be the next Netflix Inc., with its 158 million customers worldwide. In addition to Disney, Apple has introduced its own streaming service, and Comcast and AT&T are set to follow early next year. But such services have some of the highest cancellation rates among subscription-based businesses, according to Recurly, which provides billing assistance to the industry.