Why Disney+ Raising Prices Is Bad for All Streaming Services

Disney recently announced major price hikes to its Disney+, Hulu and ESPN+ services — which is concerning news for avid TV watchers and cordcutters, as it may mark an end to bargain streaming.

As reported by CNBC, Disney+ with commercials will be $7.99 per month starting Dec. 8, which is the same price as the streaming service currently is without ads. Ad-free Disney+ will see a whopping 38% price hike to $10.99. At Hulu, the ad-supported service goes up $1 to $7.99 while the ad-free version will now be $14.99, a $2 increase. This comes on top of the news that ESPN+ with ads will now be $9.99 per month starting on Aug. 23, a 43% increase.

Sure, you can save a lot by bundling the services together — various combinations of the three services come in at $10-$15 per month depending on whether you want to go ad-free or you’re an existing customer — but the real shock about this announced price increase is that Disney was considered one of the success stories of the streaming wars. Disney+ subscriptions rose to 152.1 million recently, adding 15+ million new subscribers in a quarter. Given recent issues at HBO Max (which is gutting content and cutting costs amidst a merger with Discovery) and Netflix (losing subscribers and Wall Street confidence), Disney seemed like a bright spot in an extremely competitive marketplace.

It turns out Star Wars TV shows, Only Murders in the Building and Peyton Manning simulcasts can be pricey affairs. Disney+, Hulu and ESPN+ combined to lose $1.1 billion in the fiscal third quarter, or $300 million more than the average analyst estimate, which CNBC says “reflect[s] the higher cost of content on the services.”

Add in the other competitors — Paramount+ has seen modest gains, Peacock hasn’t, and it’s hard to know the endgame for Apple TV+ and Prime Video (as they’re promoting hardware and services as much as content) — and we might be at a point where one of these streamers is bound to fail. At the very least, expect more “bundles” of services, mergers, price increases and a thinning of original content. Not that all of this is bad news — according to a Nielsen survey, nearly half of consumers say it’s hard to find the programs they want to watch because there are too many streaming services.