Hulu has begun offering its SVOD subscribers the option of adding on Disney+ for $2.99 per month, less than half what the streaming service costs on its own.
Hulu's website shows the new offer, which is only available to Hulu-billed subscribers who don’t currently have a Disney+ subscription, including Hulu SVOD standalone, Hulu Black Friday and Hulu Student subscribers. The offer could likely be targeted at the several million Hulu subscribers who signed up for the service before Disney+ launched in November 2019.
Hulu and Disney+ are already widely available together as part of the Disney Bundle, which also includes ESPN+ for $13.99 per month. Late last year, Hulu + Live TV announced a $5 per month price increase but also began including Hulu and ESPN+ as part of a subscription.
The new add-on offer from Hulu could help spark further subscriber growth for Disney+, which ended 2021 with 129.8 million subscribers after adding another 11.8 million in the fourth quarter.
Earlier this month, Disney revealed plans for a Disney+ ad-supported service—which will be sold alongside the current ad-free Disney+ experience. The new ad-supported tier will launch first in the U.S. in 2022 before expanding to international markets in 2023.
Disney is positioning the ad-supported offering as a “building block” toward achieving the company’s forecast of 230 million to 260 million Disney+ subscribers by 2024.
CFO Christine McCarthy said Disney has experienced an “incredible amount” of advertiser demand since the launch of Disney+ and that results around addressable advertising on Hulu demonstrates that the company has more demand than it does supply.
McCarthy confirmed the upcoming Disney+ ad-supported service, which is scheduled for launch later in 2022, will be the lowest cost tier but suggested that the launch isn’t all about price sensitivity.
“Some people just don’t mind seeing ads. So, we look at this as something that’s going to be a win-win for the consumers who want it, the consumers who couldn’t afford it otherwise, and it’s also going to be great for the advertisers because we have a very unique audience,” she said during a recent investor conference.