In a significant move made by Disney, the company announced Wednesday that U.S. customers are getting a new app that combines Disney+ and Hulu content.
The company also announced that it is raising the price of the Disney+ ad-free tier later in the year.
During Disney’s quarterly earnings call, CEO Bob Iger revealed that the new streaming option will launch later this year. However, the company also plans to keep Disney+, Hulu and ESPN+ as standalone platforms.
The news comes after Disney+ lost four million subscribers in the second quarter of 2023. Hulu gained 200,000 subs.
“While we continue to offer Disney plus Hulu and ESPN plus as standalone options, this is a logical progression of our [direct-to-consumer] offerings that will provide greater opportunities for advertisers while giving subscribers access to more robust and streamlined content, resulting in greater audience engagement and ultimately leading to a more unified streaming experience,” Iger stated during the earnings call.
Many of us saw this announcement coming since former Disney CEO Chapek hinted at the plans in September 2022.
“Right now, if you want to go from Hulu to ESPN+ to Disney+, you have to go out of one app to another app. In the future, we may have less friction,” Chapek told Variety last year.
This also appears to support the reports that Disney will likely buy Comcast’s stake in Hulu. Disney is reportedly expected to buy Comcast’s stake in Hulu by 2024. Currently, Comcast owns 33% and Disney owns 66%.
The integration follows other moves made by competitors, such as Paramount+ combining with Showtime as well as Warner Bros. Discovery announcing its new streaming service, Max, which merges HBO Max and Discovery+ into one platform.
Subscribers in select countries outside of the U.S. already have Hulu content bundled with Disney+.
When the streamer launched its ad-supported plan in December, the cost of its premium tier went up to $10.99/month, compared to $7.99. Disney+ will get yet another price hike for its ad-free subscription. Soon, subscribers will have to pay even more to get content with no ads.
“The pricing changes we’ve already implemented is 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,” Iger added. “As we look to the future, we will continue optimizing our pricing model to reward loyalty and reduce churn to increase subscriber revenue for the premium add free tier and drive growth of subscribers…”