By Phillip Swann
The TV Answer Man –@tvanswerman

TV Answer Man, I heard that Hulu is raising its price again. Didn’t they just raise their price a few months ago? Why do they keep raising prices and how much will it cost now? I love The Bear on Hulu but this is getting ridiculous. — Frank, Evanston, Illinois. 

Frank, Disney announced yesterday that Disney+, ESPN+ and Hulu subscribers will see price increases starting October 12. Disney+’s ads-free plan will rise from $10.99 a month to $13.99 a month (a 27 percent increase) while Hulu’s ads-free plan will increase from $14.99 a month to $17.99 a month (roughly 20 percent more). In addition, Hulu Live’s ads-included base plan will increase from $69.99 a month to $76.99 a month (10 percent more) while Hulu Live’s plan with no ads on the Video on Demand section will rise from $82.99 a month to $89.99 a month. ESPN+’s monthly sub will increase from $9.99 a month to $10.99 a month. Finally, the ads-included bundle for Disney, Hulu and ESPN+ will rise from $12.99 a month to $14.99 a month and the ads-free bundle will go from $19.99 a month to $24.99 a month.

Why Is Hulu & Disney+ Raising Prices?
If it seems like Disney just raised prices for its streaming services, it was actually late last year. Although prices are going up for the ads-free plans, Disney said prices for the ads-included separate plans for Hulu and Disney+ will not increase, which brings us to the why of this story. Disney revealed yesterday that its streaming division lost $512 million in the last quarter. The company, like other streaming companies, is desperately searching for ways to make streaming profitable. Disney execs are hoping that the higher prices for the ads-free plans combined with no increase for the ads-included plans will do two things: 1. Bring it more revenue from the higher price plans; 2. Generate more subscribers to the ads-included plans which will increase advertising revenue.

It may not work. Consumers are undoubtedly becoming weary of streaming’s frequent price hikes and may start dropping services rather than staying with them. But it appears that Disney’s strategy has become the playbook in the industry. Netflix recently eliminated its $9.99 a month ads-free Basic plan in the United States for new subscribers in an attempt to generate higher-priced subs and subs to its $6.99 a month ads-included package. This is exactly what Disney is doing and you will likely see more streamers follow suit in the coming months.

Frank, hope that helps. Happy viewing and stay safe!

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— Phillip Swann
@tvanswerman