Disney Is Set To Increase the Price for Its Ad-Free Tier

Disney is set to increase the price for its ad-free tier and will bring Hulu content into Disney Plus in the process. Bob Iger, the CEO of the entertainment company announced that a ‘one-app experience” will be coming to US viewers in the later parts of this year.

Disney Ad-Free Tier

Disney Ad-Free Tier

Disney at the moment is set to combine Hulu and Disney Plus into one single streaming app. During Disney’s Q2 earnings call on Wednesday, CEO Bob Iger made the announcement that the company is going to craft a “one-app experience” within the US and then stated that it is raising the price of its ad-free plan, which at the moment only costs $10.99 per month.

“While we continue to offer Disney Plus, Hulu, and ESPN Plus as standalone options, this is a logical progression of our DTC [direct-to-consumer] offerings that will provide greater opportunities for advertisers while giving bundle subscribers access to more robust and streamlined content, resulting in greater audience engagement and ultimately leading to a more unified streaming experience,” Iger stated.

He however continued, “Meanwhile, the pricing changes we’ve already implemented a proven successful, and we plan to set a higher price for our ad-free tier later this year to better reflect the value of our content offerings.”

Disney’s Recorded Recent Loss

While the streaming business of Disney posted a less-than-expected loss of $659 million, it however, still lost 4 million subscribers worldwide in contrast to the previous quarter for a total of 157.8 million which is a potential sign that price hikes have begun to offset a loss in the company’s subscribers.

We still don’t even know just how much Disney will be increasing the price of its ad-free plan or if this very pricing will change after Disney Plus and Hulu become available as a single app. The company just recently raised its prices on both Hulu and Disney Plus in the previous year and it also introduced a $7.99 per month ad-supported tier, which chief financial officer of Disney, Christine McCarthy said will be launching in Europe at the later end of this year.

Rollout of the Combined App

Iger however added that the combined app will be rolling out by the end of the calendar year and also stated that the company will be sharing more details “in the future.” Content of Hulu is already bundled into the Disney Plus app in select countries and regions outside of the US. The announcement of Disney comes fresh off the heels of the report of Warner Bros. Discovery that it is bundling HBO Max and Discovery Plus into a single app known as Max, which will launch in the later part of this month.

Disney at the moment is debating whether it will buy Comcast’s 33 percent stake in Hulu, which it has now agreed to sell to Disney in January 2024. And at the time of the agreement in question, both companies agreed that Hulu would hold a minimum valuation of $27 billion, thus making the stake of Comcast worth at least $9 billion, which the Disney Company might be hesitant to pay if rough economic times persist.

What Iger Has To Say about the New Development

“How that ultimately unfolds is to some extent in the hands of Comcast and in the hands of, basically, a conversation or a negotiation that I’ve had with them,” Iger when answering a question about Comcast, said. “There seems to be real value in having general entertainment combined with Disney Plus, and ultimately, Hulu is that solution.”

The company also just announced its plans to take away some content from its streaming services, with McCarthy, Disney’s CFO stating that the company is “in the process of reviewing the content on our DTC services to align with the strategic changes in our approach to content curation.” This move will however result in an impairment charge of anywhere starting from $1.5 to $1.8 billion.



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