So were you wondering if all these streaming services bringing ads onto their platforms would actually reduce overall prices? Well, keep dreaming.
All information in this article is for the U.S. – Gizmodo Australia has reached out to the local outpost of Disney+ for clarification and we’ll update this article as soon as we learn more.
Disney announced Wednesday during their third quarter earnings report new pricing packages for its streaming services. The company said that starting December 8 for U.S. users, the new ad-based subscription tier on Disney+ will be $US7.99 ($11) a month, which is what users currently pay to watch without any pesky ads. If you want to keep watching your favourite Star Wars, Marvel, or Pixar film without commercial breaks, you’ll need to pony up $US10.99 ($15) a month.
Hulu will also see price increases, with its ad-based service going up a buck from $US6.99 ($10) to $US7.99 ($11). It’s ad-free subscription tier will rise from $US12.99 ($18) to $US14.99 ($21). All this will go into effect October 10.
For those sports watchers, the Disney-owned ESPN+ was already set to jump from $US6.99 ($10) to $US9.99 ($14) a month, while the annual plan will similarly see an increase of $US69.99 ($97) to $US99.99 ($139).
But what about that sweet Hulu, ESPN+ and Disney+ bundle? That’s going up a dollar from $US13.99 ($19) to $US14.99 ($21). There will be a new tier of Hulu and Disney+ with ads for $US9.99 ($14), and ads for days on its bundle with all three for $US12.99 ($18).
Those prices are still below some services, like Netflix’s $US15.49 ($22) basic plan or HBO’s ad-free $US14.99 ($21) tier. Wednesday’s Q3 results showed Disney’s streaming services combined saw a loss of $US1.1 ($2) billion in the past few months, which CNBC reported was $US300 ($416) million more than analysts predicted. The company said this was due to higher costs to produce content. This is despite an apparent boom in subscriptions to 152.1 million. Hulu had 46.2 million while ESPN+ had 22.8 million.
There’s been a wealth of speculation whether companies bringing ads into streaming would inflate or deflate prices. Netflix, which still remains the big boy on campus in terms of subscriber numbers despite a loss of close to a million eyeballs two quarters in a row, is planning to bring forth a new ad-based subscription tier. Microsoft will be helming that new ad venture, but there’s still so much we don’t know about what that will do for overall prices.
Other media companies are going the roundabout way of fixing their struggling streaming models. Warner Bros. Discovery announced last week they were combining HBO Max and Discovery+. They did not discuss pricing on any ad or non-ad subscription tiers, but if this precedent is anything to go by, it probably won’t be anything to make our wallets smile.