CEO Bob Iger has said that Hulu will be a streaming priority for Disney, which will use it as an adult-focused complement to Disney’s upcoming family OTT platform Disney+. This problem will soon largely be Disney’s: The company will become a majority owner of Hulu once its acquisition of 21st Century Fox is complete. In the third quarter of 2018 alone it lost $440 million due to the high cost of original and licensed content for its ad-supported and live TV services. The need to grow Hulu is becoming more crucial as the company continues to bleed money. At this time, Hulu is a U.S.-centric service, so it’s reaching 30% of Spotify’s audience, or about 62 million (Spotify does not break out its Premium subscribers by country). By piggybacking on Spotify–which has over 96 million paying members and 207 million monthly active users–Hulu can create a kind of next-generation entertainment bundle with a company that is similarly popular with younger demos and that has a strong track record of converting its free users to paying subscribers.
Amazon has also crossed the 100 million mark (though that’s the number of Prime subscribers and not necessarily people solely choosing Prime Video).
Hulu currently has over 25 million subscribers, whereas Netflix has more than twice that in the U.S.
Both deals show how Hulu is determined to grow its subscriber base to catch up to Netflix and Amazon, which are still significantly ahead in the streaming race.
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