Hulu rolls out dramatic discount ahead of Disney+ launch

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Hulu promotions are helping drive subscriber growth for the service. (Hulu)

Hulu’s ad-supported tier was already inexpensive relative to other streaming services, but now the company is knocking even more off the price.

Hulu just announced a promotion tied to Chrissy Teigen that will give new subscribers (or people who haven’t subscribed to Hulu over the past 12 months) 50% off the service’s monthly price for the first six months. That comes out to $2.99 per month.

That’s not even the biggest discount that Hulu has ever offered for its service. In late 2018, Hulu rolled out a promotion selling its service for $0.99 per month for a year.

The new promotion comes after earlier this year Hulu lowered the price of its ad-supported service tier from $7.99 per month to $5.99.

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The promotions are having a positive effect on Hulu’s subscriber growth. The service ended the most recent quarter with 28 million paid memberships. But, they could also be contributing to Hulu’s financial drain on its owners.

The big discount promotion is coming under the watch of Disney, which assumed full control of Hulu after reaching an agreement earlier this year with Comcast, which still owns 33% of the subscription service. Disney said that it absorbed an additional negative impact to earnings per share of about $0.06 as a result of the deal. Earlier this year, Disney said that Hulu’s operating losses will peak this year at $1.5 billion, and then the service achieve profitability by 2023 or 2024.

Disney is putting a lot of its marketing muscle behind the upcoming launch of Disney+, its streaming service that will house new and library content from brands including Disney, Marvel, Star Wars, Pixar and National Geographic. The company is also taking an aggressive pricing strategy with the service, which will cost $6.99 per month, well below what competitors including Netflix and Amazon Prime Video charge for their streaming services.

Disney also plans to sell Disney+ as part of a $12.99-per-month bundle alongside ESPN+ and Hulu.