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Will Hulu's Price Revisions Help Boost Disney's Revenue?
By Sophia Nicholson
Hulu's price revisions
Subscription service Hulu has recently updated the monthly prices of its subscription plans. On January 23, Hulu announced that it was reducing the monthly subscription rates of its basic on-demand offerings but increasing the cost of its live TV subscriptions. The price changes will take effect for new subscribers starting on February 26. The news of Hulu's increased pricing for its on-demand live TV service follows Netflix's (NFLX) 13%–18% hike in subscription prices in the United States.
Hulu is owned by the Walt Disney Company's (DIS) ABC, Comcast's (CMCSA) NBCUniversal, 21st Century Fox (FOXA), and AT&T's (T) WarnerMedia. Disney currently has a 30% stake in Hulu and will gain an additional 30% stake from Fox after it completes its pending acquisition of Fox's assets. NBCUniversal owns a 30% stake in Hulu, while WarnerMedia owns the remaining 10%.
New pricing
According to Hulu's new pricing, its entry-level on-demand service with ads will now cost $5.99 per month, down from $7.99 with ads. Its monthly on-demand streaming service without ads will remain at $11.99. Its on-demand live TV service is pricier. The on-demand live TV service with commercials will be $5 higher at $44.99, while the live TV service without ads will be $7 higher at $50.99.
Hulu had 25 million total subscribers in the United States as of January 8, ~47% higher than in the previous year. Its increased prices are expected to help it recover from its losses and, in turn, boost its revenue and help it to pay off its massive debt.