Disney+, Hulu, and the consolidation of the big streamers

It’s starting to sound familiar: one big streaming service assimilating the content of another. HBO Max (now just Max) did it with Discovery+, Paramount+ did it with Showtime, and now Disney+ will add Hulu’s content to its mix of family-friendly titles.

The Disney+ news came late Thursday as Disney announced its quarterly earnings (its streaming efforts are still losing money, but not as much as expected). 

The plan is to combine Hulu’s content with Disney+ within a “one-app experience,” Disney CEO Bob Iger said, while still keeping standalone versions of the two streamers.

The consolidation is set to happen by the end of the year, along with another predictable change: a price hike for the ad-free Disney+, which currently costs $10.99 a month. 

There’s no word on how big the price increase will be, although Iger said he wants to “widen the delta” between the ad-free Disney+ tier and the ad-supported plan, which costs $7.99 a month.

There’s also no word on whether there will be any changes to the “Disney bundles” of Disney+, Hulu, and ESPN+, which start at $9.99 a month for the Disney+/Hulu with-ads bundle.

Why will there be a “one-app” version of Disney+ and Hulu? Iger explained it thusly:

While we will continue to offer Disney+, Hulu and ESPN+ as standalone options, this a logical progression of our [direct to consumer] offerings that will provide greater opportunities for advertisers while giving bundle subscribers access to more robust and streamlined content, resulting in greater audience engagement and ultimately leading to a more unified streaming experience.

In other words, Disney (which owns a 66-percent stake in Hulu, and is now eyeing Comcast’s 33-percent stake) will be able to charge more for advertising on a combined Disney+/Hulu offering, while also hoping to attract more subscribers with a broader offering of movies and TV shows, all under one roof.

That’s very much the strategy behind HBO Max joining forces with Discovery, and Paramount+ and Showtime combining their wares into a single app. (It’s worth noting that there are still standalone versions of both Discovery+ and Showtime. Will they stick around? Open question.)

Ultimately, the big streamers are looking to target Netflix, which positions itself as a one-stop shop for all your video streaming needs, with a price–$19.99 a month for the priciest tier–to match.

So, which streamer might be next in the consolidation derby? Some analysts think it might be Comcast-owned Peacock, which at just 20 million subscribers is far behind its streaming competitors.

There’s been talk of Comcast gobbling up Warner Bros Discovery, the parent company of Max, as early as 2024–and if that happens, it’s easy to imagine Comcast choosing to roll the bleeding Peacock (which has shown signs of life recently with Poker Face and Mrs. Davis) into Max.

For his part, Warner Bros Discovery CEO David Zaslav has insisted that the company is “not for sale.”  

But as Brad Pitt says in Moneyball, “You know what happens to the runt of the litter? He dies!” And as time marches on, we’ll probably see more of the streaming stragglers meeting that fate, either through consolidation or outright shuttering.