SALT LAKE CITY — Hulu announced Wednesday a drop in price just weeks after Netflix announced a price increase, The Verge reports.
- Hulu announced it will drop the price of its basic subscription plan from $7.99 to $5.99.
- The basic plan will still come with ads.
Date: The price drop begins Feb. 26.
However: The price drop doesn’t impact the ad-free plan, which costs $11.99 per month.
- The decrease won’t impact the Spotify bundle plan, which costs $12.99.
Context: “Hulu has offered its service at $5.99 previously on a promotional basis, and it clearly makes enough of a difference at pulling in subscribers to justify a price drop for the standard rate. In case you were concerned, customers will not see an increase in ad volume because of the reduced pricing.”
Bigger picture: Netflix raised its prices 13 to 18 percent earlier in January. The price increase represented the largest since the company launched 12 years ago, according to The Associated Press.2 comments on this story
- The most popular plan rose from $11 to $13 per month.
- “The extra cash will help to pay for Netflix's huge investment in original shows and films and finance the heavy debt it has assumed to ward off rivals such as Amazon, Disney and AT&T,” according to The Associated Press.
- The increase in prices among streaming services come as the company finds itself more in demand from consumers, allowing them to control the market.I wrote about this concept for the Deseret News.
Does it matter?: Uproxx notes the Hulu jump might not matter in the long term.
- “In either case, the new pricing structure might end up being moot pending a deal with Disney to assume majority ownership of Hulu, which would likely factor in Disney’s upcoming Disney+ streaming service."