Chief executive officer and chairman of The Walt Disney Company Bob Iger walks on the floor of the New York Stock Exchange (NYSE) before ringing the opening bell, November 27, 2017 in New York City. Disney is marking the company's 60th anniversary as a listed company on the NYSE.

On Disney’s fourth-quarter earnings call Thursday, CEO Bob Iger said he saw “price elasticity” around Hulu with Live TV, the company’s digital TV bundle.
Industry analysts disagree.
Pay TV just had its worst quarter in history, and consumers are increasingly driven by price competition.
Comcast, which owns 30% of Hulu, is also a consideration.
Analysts say the cable giant could sell off its Hulu stake and focus its attention elsewhere.

Price hikes may soon be coming to Hulu.

Disney CEO Bob Iger talked streaming services on the company’s fourth-quarter earnings call on Thursday and noted he planned to invest to compete more heavily in the market. And expect subscription cost increases to come with that investment.

“I also think there’s some pricing elasticity too, but notably on the multi-channel front,” Iger said in response to an analyst question about Hulu. “And I think there’s an opportunity to improve – or I should say increase our pricing there.”

Hulu offers various subscription streaming offerings from a base $7.99 subscription that includes ads and access to a full content library, to a $39.99 plan that comes with multi-channel live TV.

Pricing elasticity on a product that costs $39.99 a month?

Wall Street and media analysts who monitor the industry don’t think Iger’s comments connect with the market dynamics they’ve seen.

“His comments are illogical given what we know about consumer media consumption these days,” Alex DeGroote, an independent media analyst, told Business Insider. “The market is experiencing downside pressure on all fees.”

The pay-TV industry reported its worst quarter to date in the third quarter 2018. And while vMVPDs, or digital-TV packages, previously helped to soften declining subscribers, their subscriber growth slowed. As a result, pay TV had a historically bad quarter, losing more than 1 million subscribers for the first time.

“Q3 is a record month for cord cutting …read more

Source:: Business Insider

      

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