ESPN+ is putting an emphasis on the symbol at the end of its name.
The Disney-backed streaming-video sports service intends to raise its monthly subscription fee by $3 a month—a 43% price hike that outstrips even the current rate of inflation—and it is doing so at a time when big media companies find the prospect of monetizing new streaming efforts to be significantly more challenging, Variety reports.
Starting August 23, 2022, the price of an ESPN+ subscription will rise to $9.99 per month, compared with the current rate of $6.99 per month, and the cost of an annual subscription will rise to $99.99, compared with the current rate of $69.99. Subscribers to ESPN+ are expected to be notified officially next week. The price of what is known as the “Disney Bundle,” a broader subscription that encompasses ESPN+, Disney+ and Hulu, will not change at present, nor will the current price tag for the UFC pay-per-view events ESPN shows.
ESPN last announced a price hike for its streaming service in July of last year, and raised the monthly price to $6.99, compared with $5.99.
Other streaming outlets are also searching for new ways to keep cash flowing as consumers have a wider array of choices from which to select—and for which to pay. Netflix earlier this week unveiled a new partnership with Microsoft to launch an ad-supported tier of its service, and Disney+ is also set to debut a new advertising-supported option. Warner Bros. Discovery’s HBO Max has an ad-supported tier that is in many cases cheaper to buy than the linear HBO package sold by cable and satellite distributors.
Disney has continued to spend heavily on sports rights, and a subscription hike would give the massive media company new revenue to offset the costs of new contracts with the NHL, PGA Tour and others. Indeed, some of the games it now offers were previously available on a stand-alone basis at costs that either were greater than the new ESPN+ price or that offered significantly less content. The NHL.tv package of out-of-market games was priced at $24.99 per month and did not include the scope of professional hockey games ESPN now shows. PGA Tour Live, a golf package provided by that league, was priced at $9.99 per month. ESPN has also expanded rights with the NFL, Wimbledon and the Australian Open, and struck agreements with LaLiga and college-sports providers.
Top Disney executives have made no secret of their desire to wring profits from the company’s growing emphasis on streaming. “As we increase our content investment, we believe that that’s going to give us the ability to adjust our price,” Disney CEO Bob Chapek told investors in May.
The company also has reason to think ESPN+ at $9.99 a month remains competitive. Rival DAZN, which relies heavily on boxing, charges $19.99 per month. A new streaming offering from regional sports outlet NESN costs $29.99 a month for Boston Red Sox and Boston Bruins games. And many of the major leagues’ own streaming services cost anywhere from $14.99 to $24.99 per month.