Disney Plus to hike subscription fees and merge with Hulu in new app after losing 4m subscribers

Disney has announced it will be combining its Disney+ and Hulu platforms in a new app after losing four million subscribers.

The new “one-app experience” is set to launch later this year for customers in the US to create a “unified streaming experience”, Disney boss Bob Iger said.

But the company still plans to keep Disney+, Hulu and ESPN+ as standalone platforms as well.

It comes after Disney+ lost four million subscribers during the first three months of this year, with most losses coming from Disney+ Hotstar in India after the company lost streaming rights to Indian Premier League cricket matches.

Disney also lost 300,000 customers in the US and Canada after increasing subscription prices in December.

The price for the ad-free Disney+ subscription will also be increasing this year from the current $10.99 a month. The amount the price will be hiked is not yet known as it will only take effect once Disney+ and Hulu becomes available as a single app.

In the UK the price of a Disney+ subscription is currently £7.99 a month, or £79.90 for a yearly subscription.

But Disney has confirmed it will be bringing its ad-supported tier to Europe - which will presumably include the UK - “by the end of this calendar year”, which is likely to result in higher prices for subscribers.

The ad-supported tier launched in the US in December at a cost of $7.99 per month. Those who wanted to ditch the ads then had to start paying $10.99 per month for the ad-free experience - an increase of $3.99.

But Disney CEO Bob Iger last week announced plans to increase the price of the ad-supported tier even further, to “better reflect the value of our content offerings”.

If the ad-supported tier comes to the UK in a similar way to the US, it is likely that subscribers will pay £7.99 per month for the ads tier, and those who want no adverts may have to pay up to £10.99 per month.

In a conference call last week, Mr Iger told Disney employees: "As we look to the future, we will continue optimising our pricing model to reward loyalty and reduce churn to increase subscriber revenue for the premium ad-free tier and drive growth of subscribers."

The number of households subscribing to Disney+ has increased in the UK over the last few years, reaching around seven million subscribers at the end of last year.

But  the cost of living crisis had a knock on effect on the number of people subscribed to streaming platforms. According to an analysis from the research firm Kantar, UK households stopped paying for almost 170,000 streaming services in the last three months of 2022.

The top reason households gave for ending their subscriptions was because they wanted to “save money.”

Disney+ has close to 158 million subscribers around the world, although it is still behind its rival Netflix which has 232.5 million subscribers.