Business

Disney raises the price of its streaming service

Disney unveiled a new pricing structure that incorporates ad-supported Disney+ as part of an effort to make its streaming business profitable.

Starting December 8 in the US, Disney+ with ads will be $7.99 per month – currently the price of Disney+ without ads. The price of Disney+ without ads will increase 38% to $10.99 – a $3 month increase.

The price of Hulu without ads will increase by $2 per month, from $12.99 to $14.99, effective October 10. Hulu with ads will increase by $1 per month, up from $6.99 to $7.99.

Disney announced last month that ESPN+ with ads will increase 43% to $9.99 per month.

The price increase reflects the growing operating loss for Disney’s streaming services. Disney+, Hulu, and ESPN+ combined losses of $1.1 billion in the third fiscal quarter, $300 million more than analysts’ average estimates, reflecting the cost of content on the service. higher. The incremental drop in activity comes even as Disney added about 15 million new Disney+ subscribers during the quarter, about 5 million more than analysts’ estimates.

Disney previously announced that they plan to lose money on Disney+ until 2024.

Disney+’s average revenue per user fell 5% during the quarter in the United States and Canada as more customers took advantage of the cheaper multi-product service.

Overall, the company’s quarterly results, also released on Wednesday, beat analysts’ expectations for a top line and bottom line. Disney+ subscriptions grew to 152.1 million in the most recent period, beating Wall Street’s forecast of 147 million.

Including Disney+, ESPN+ and Hulu (partially owned by Comcast), Disney has 221 million streaming subscribers

Package price

Disney also announced new bundle pricing that combines its Disney+ product with advertising.

For existing customers only, the ad-free Disney+ plan and Hulu and ESPN+ with ads will increase by $1, from $13.99 to $14.99.

The price of a Disney+, Hulu, and ESPN+ bundle, all with ads, will be $12.99 or $1 less than the current Disney bundle price.

Consumers will be able to purchase Disney+ and Hulu plans for $9.99 per month with ads. It’s a discount when paying for Disney+ and Hulu with separate ads.

The price for Disney+ without ads and Hulu without ads, with ESPN+, is still $19.99 per month.

Disney will also have new pricing for its Hulu with live TV bundles. Subscribers who want Hulu with live TV and Disney+, Hulu, and ESPN+ with ads will have to pay $69.99 per month. For existing customers, Disney will offer ad-free Disney+ in that bundle for $74.99. Hulu’s premium plan with live TV plus Disney+ and Hulu with no ads will be $82.99 per month.

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.

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