Hulu-Spotify Bundle May Be Underpriced

Here’s something you don’t hear every day: a streaming content bundle that is priced too low.

According to a poll commissioned by Morning Consult and The Hollywood Reporter, the Spotify-Hulu bundle, which combines Spotify Premium with Hulu’s base tier for $9.99, is below what consumers would be willing to pay.

Morning Consult used the Van Westendorp Price Sensitivity Meter model to attempt to determine the optimal price for a bundle that includes Hulu and Spotify. The survey found that $16 was the optimal price, well above the $10 the companies charge.

While the survey suggests Hulu may be leaving money on the table by offering such a deep discount to Spotify subscribers, the company’s ultimate goal appears rooted in advanced advertising.

Hulu is betting Spotify can help it add, potentially, millions of users who can be monetized by new, targeted advertising products the company has -- or will be -- in the market.

The company launched a revitalized programmatic marketplace earlier this year in partnership with Telaria. It is developing other advertising options that it will roll out at its upfront later this spring.

Of note to other streaming video and music companies: the Morning Consult poll also found a significant number of respondents considered bundles to be appealing, with 66% saying they would be likely to subscribe to a music streaming service that also included a TV/movie service.

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