WHAT’S BEING CLAIMED:
- Hulu’s basic plan is down to $5.99 per month effective Feb. 26, the entertainment company announced on Wednesday.
- The company’s ad-free plan stays at $11.99 per month while its live TV option will have a bit of a price hike.
- The announcement comes after Netflix revealed price hikes on its plans last week.
Entertainment company Hulu announced on Wednesday that it is dropping the price of its most popular plan to $5.99 per month starting Feb. 26. The basic plan drops from $7.99 per month.
It is the company’s action to stay in the competition as the video streaming space becomes crowded. Meanwhile, Hulu’s ad-free plan sticks to $11.99 per month and its live TV version will have a $5 increase from $39.99 to $44.99 per month. Hulu’s price updates will be effective beginning Feb. 26.
The notice comes after Netflix announced last week that it’s going to have a price hike by 13% to 18%. From $8, the company’s cheapest basic plan will increase to $9, while the HD standard plan will hike from $11 to $13, and Netflix’ 4K premium plan will be up from $14 to $16.
The price hike is due to the increasing content expenses as streaming giants Netflix, HBO and Hulu are “investing in original programming in an effort to claim increasingly contested market share.” The three streaming bearers are feeling the pressure from new companies.
Hulu’s price drop is a business strategy — it can win the company customers before media incumbents launch key streaming.
New entrants reportedly include AT&T, Disney and NBCUniversal, all ready to start streaming services in the next two years.
The rate increase at the highest tier will also help Hulu achieve a better margin on a traditionally expensive live TV offering, according to CNBC.
YouTube TV, owned by Alphabet, announced on Wednesday that it’s expanding its similar live TV plan nationwide, at $40 per month.
With Hulu’s basic plan price drop at $5.99 per month, it is going to be the most affordable ad-included plan among all streaming services.