Disney CEO Bob Iger Gives More Details On Hulu Merging Into Disney+

During today’s quarterly investors call to discuss the latest financial results, Disney announced that it would fully integrate Hulu into Disney+, with a unified Disney+ and Hulu streaming app experience becoming available to consumers in the United States next year.

It was also announced that Hulu will become a global general entertainment brand, and in the fall, it will replace the Star tile on Disney+ internationally.

While no details on exactly when Hulu would be merging into Disney+ in the United States were revealed, nor details on when the Hulu app would close down or the price of the combined offering,  when asked about the future of Hulu as a stand-alone app?  Bob Iger replied:

I think the way to look at the combination is to start with the consumer. You’re going to end up with a far better consumer experience when those apps are combined by combining all of the program assets of both apps, both card apps and obviously, with an improved consumer experience comes the ability to lower churn, which is obviously something that we’re very, very focused on and committed to doing. We obviously will deliver efficiencies when these are together. They’ll be on one tech stack as, for instance, one tech platform. We already sell the advertising together, but this will give our sales organization a chance to package them far more effectively than they have before.

I imagine down the road, it may give us some price elasticity as well that we haven’t had before. And it also provides us with a tremendous bundling experience because when you have the one app that has a significant amount of all of the Disney and the other Disney-branded programming with the general entertainment programming bundled, for instance, with the ESPN direct-to-consumer app, I think you end up with a proposition from not only a consumer perspective, but also from our perspective that’s far better than what we’ve had before.

Iger was also asked about Disney’s strategy to take advantage of engagement trends on Disney+ and Hulu, to which Iger replied:

When we combine — when we gave people an opportunity to have a more seamless experience between Disney+ and Hulu, we saw engagement increasing. And we would hope that when we take this next step, which is basically full integration that, that engagement will go up even more. In addition to that, we’ve implemented a number of technological improvements that are designed to increase engagement. And we’re really pleased with what we’re seeing already, but we also know that it’s still a work in progress, and we have a lot more work to do. For instance, just the strength of our recommendation engine. We’re also experimenting like crazy, where we’re basically trying different elements out on consumers and getting data back from them in order to figure out what works the best. That includes basically the homepage experience and basically what they see when they open up an app.

Iger also spoke about some of the advantages of the introduction of the Streams feature, which is basically a more laid-back linear channel style option to enjoy TV:

In addition, we’ve added streams, which was a technological advancement. There are some great streams you can watch, I think, 30-some — [ 35 ] seasons or whatever it is of The Simpsons on one stream as a for instance, that’s also something that increases engagement. There’s an ABC news stream that you can watch. So there’s some news on all the time on the service. So what we’re basically doing is by one, combining them, we hope to increase engagement more. Two, with all the technological advances, we’re increase — we will increase engagement more.

One of the big advantages of merging Hulu and Disney+ together, is how this will help Disney save money, with Iger explaining some of the benefits:

In addition to that, as it relates to content spend, I’d say that from a domestic perspective, you shouldn’t expect that we need to increase the spend on content significantly. Where we believe we should be investing is to grow our international businesses. So one, we’re going to brand the general entertainment from Star to Hulu across the world, for instance. Two, these technological advancements will obviously help in markets where our engagement has not been as high as they need to be. Three, we probably will invest in very selected markets internationally where we really feel there’s a potential to grow our bottom line, to grow subs, to grow advertising revenue and to grow our bottom line.

Roger’s Take:  There are still plenty of questions about the future of Hulu, such as how much it’s going to cost when combined?  Will Hulu still be an additional add-on? Though the Star hub around the world isn’t, so it would seem odd if they tried to do that.  What’s going to happen to Hulu+Live TV?  Will it merge with Fubo TV once that deal is complete?   There are more questions than answers, and we might not have those answers for months, since it won’t be happening until next year.  But, Disney has let the world know that Hulu is becoming part of Disney+ sometime in the future, which means that when it does happen, people won’t be so shocked to see the Predator next to Mickey Mouse anymore. 

What do you think of Hulu merging into Disney+?  Let me know on social media!