Why Streaming Services are Planning 2024 Price Hikes
By Movieguide® Contributor
The cost of TV and music streaming services is set to rise throughout 2024.
This summer will see price raises from Peacock (a $2 bump per month, following last year’s $1 price hike), Max ($1 more a month) and Spotify (with raises from $1 to $3, depending on the plan).
“The new hikes are also a subtle bit of social engineering, strategic moves meant to push consumers in certain directions or otherwise pay up,” the Hollywood Reporter pointed out.
The reason many streamers point to as the reason for price increases is an increase in value. For example, Spotify is expanding its audiobook selection, while Peacock will offer Olympics footage and Netflix plans on adding NFL content.
Live sports are set to be a big draw for consumers in 2024.
“According to one study, 29% of viewers are watching sports on streaming services,” Fast Company noted.
Another component to these increased prices? More streaming services are choosing to partner up and bundle their content.
Disney+, Hulu and Max have teamed up, while Comcast has started offering a bundle of Peacock, Netflix and Apple TV+ to its users.
“Consumers like bundles, especially if they’re getting a price break,” Variety reported. “Media companies like bundles because they help reduce churn (i.e., cancellation rates) and lower customer-acquisition costs, even it means working with would-be rivals.”
Bank of America’s Jessica Reif Ehrlich commented on the bundle concept, saying, “Our thesis was (and remains) that, as the streaming market has become saturated and given the reduction in churn and subscriber acquisition cost associated with a bundled offering, media companies will return to commercial partnerships/bundling agreements. That has played out so far this year.”
Movieguide® previously reported on the rise in bundle plans and what that might mean for users:
Disney/ESPN, Fox and Warner Bros. Discovery’s sports-streaming merge is drawing concern from members of Congress who believe the platform will become anticompetitive.
Per Variety, “In a letter sent Tuesday (April 16) to the CEOs of the three companies, Rep. Jerrold Nadler (D.-NY), the ranking member of the House Judiciary Committee, and Rep. Joaquin Castro (D.-Texas) requested answers about the competitive implications of the proposed sports streaming JV.”
However, the reps are concerned that the platform will raise prices.
“As programmers, your companies exert tremendous influence over pricing across the live sports TV ecosystem,” Nadler and Castro wrote in a letter. “Upstream, programmers negotiate content licensing deals with sports leagues like the National Football League and the National Basketball Association for the media rights to their sports events. Downstream, programmers determine the terms on which video distributors may license programmers’ sports channels.”
“Without more complete information about the pricing, intent, and organization of this new venture, we are concerned that this consolidation will result in higher prices for consumers and less fair licensing terms for upstream sports leagues and downstream video distributors,” the letter continued.
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