One of the reasons to ditch linear television providers for streaming services like Hulu + Live TV or YouTube TV is obviously the cost.
Initially, these platforms offered a more limited selection of channels but at a much cheaper cost; along with the lack of contracts and hassle that go along with any traditional cable or satellite service. In the years since they first hit the market, though, costs have been creeping up. Typically that comes along with a new group of channels, as when YouTube TV boosted their price upon adding the Discovery portfolio a few years ago.
A monthly subscription to Hulu + Live TV now costs $64.99, and soon that’s going to increase to $69.99 for new and existing customers. But rather than adding external channels, the Hulu package will now include ESPN+ and Disney+ access, a move clearly made out of a need for corporate synergy. It’s not likely a coincidence that this move is being made weeks after Disney+ missed subscription targets this past quarter.
Todd Spangler reported the details at Variety, including how this move affects customers who already subscribe to the services in question:
For Hulu + Live TV customers who already have Disney Plus and/or ESPN Plus, those accounts will roll into their new plan on Hulu (as long as the email addresses are the same for each account). In addition, those subscribers will receive a credit for the retail value of their existing subscription(s), starting with their first billing cycle on or after Dec. 21.
Disney is eager to prove to Wall Street that its major strategic investment in Disney Plus is still on a healthy growth curve, particularly in the U.S., after the Mouse House drastically missed estimates for the September 2021 quarter. As of Oct. 2, Hulu + Live TV had 4 million paid subscribers, so the move will instantly add millions of subs to Disney Plus and ESPN Plus tallies in the year-end quarter — although you can expect a higher level of churn for Hulu + Live TV given the price increase.
This is a time-honored tradition for subscription models, of course. It’s why I received Golf Digest for approximately two years after canceling my subscription, and why The Athletic runs half-off a year deals seemingly every few weeks. Disney clearly views this as a short-term numbers boost for the quarter. As far as being a value-add for Hulu + Live TV customers, well, sort of? If you were already bundling everything, it probably doesn’t affect you much. And if you’re happy with Hulu + Live TV, are you likely to cancel over the addition of two premium networks and content libraries for just $5?
Some obviously will, but Disney is clearly betting most won’t, certainly not enough to outweigh the subscriber number boost for Disney+.
[Variety]
