Hulu and Disney+ No Longer Support Signups and Payment Using App Store

[TheDrakeMan]

I have a Roku smart TV. I watch all my streaming content there. I don’t pay Roku a dime. Should Roku be taking 30% of every subscription I have? Apple would never remove these apps from the App Store. Apple needs them more than they need Apple.

You paid Roku when you bought the TV for the content that they provide, or to access the content from providers you use. Apple provides a store where people can download the app to watch content at their convenience with the subscription they have, and can handle that subscription through Apple if they choose. It was never a requirement for someone to start their Hulu, Disney+, etc subscription through Apple, but if they were to, then why shouldn’t Apple charge the service providers a portion of the revenue they receive for that? I disagree that Apple needs them more than Hulu or whoever else needs Apple. Apple won’t stop being as big as they are if Hulu suddenly disappeared one day. If Apple decides to remove Hulu and others from their App Stores due to this issue, then you’ll see who needs who.

 

[TheDrakeMan]

Thankfully in the EU these apps will just be downloaded on an alternative store or even on the service provider website, so Apple can do what it wants about hosting them on the App Store, but it won’t mean users won’t have access to an app and will be forced to use the website to watch. Of course it is only a matter of time before alternative app stores will be available worldwide; the eu has the huge merit of setting a precedent, but it will be not the only place where the new status quo will apply.

Cool story, that entirely depends on the amount of people that are even remotely interested in downloading other app stores. Plus, it was never a requirement to solely use the Apple app store for subscriptions. Nothing was stopping anyone from signing up on Hulu.com and then logging into their account on the Hulu app. The 30% cut Apple takes is a service fee for these providers that expect to bring in a ton of revenue by tapping into a pool of millions of consumers interested without having to pay for the convenience of accessing them. Hulu is accessible through the web browser on an iPhone, but you’ll probably get a much better experience watching your content through the app.

 

[Abazigal]

What do the other vendors charge? Is 30% industry standard or is it simply because Apple’s the largest?

Nintendo, Sony, Xbox all charge 30% as well.

You don’t see game developers complaining about having to pay Nintendo 30% of revenue from games they sell on the switch platform. To them, it’s just another cost of doing business.

Nor do you see epic fighting to get their App Store onto the PS5.

Apple’s just the most prominent and convenient target for everybody to bash on.

 

[@Brett]

I like that I can pay and subscribe through Apple. It’s good to see the subscriptions in one place and pay. Also easy to cancel. Disney+ may be getting cancelled by me still. The last prices rise I was on $139.99 a year and Disney moved me for the $179.99 plan in Australia. It just does not have the content.

 

[@Brett]

It’s not news when many subscription services are not as profitable as they need them to be.

Easy to cancel through the subscriptions section with Apple. Wonder if that is also a reason. Also with profitability if they are not making money that is on them. But constant easing of prices and ads makes these offerings worse for consumers.

 

[Sogeman]

If they gave the savings to subscribers everinye would applaud. But annoying users and increasing prices doesn't go over well

 

[davide_eu]

Privacy is where my and Apple’s interests align.

Bro, you made my day. A lot funny... Thanks

 

[davide_eu]

I use Facebook app on my phone and iPad. I use Facebook site when I’m using my Mac or surface.

Mr. a$$le brought technology in the past. We had the new idea of a browser, to get rid of "tucows" (if you are an experienced guy you know what I mean), then he brought this stupid idea to use an app for everything.

 

[Belifant]

They wouldn't raise it to "that number" (again, this is all made up) if that number caused them to lose a significant number of subscribers, and therefore subscriber profits, than a lower number would provide. The savings from the Apple commissions theoretically allowed them to maximize profits because costs were lower, they avoided having to raise the price "too much", and as a result kept (or added) more subscribers. Hypothetically speaking.

I'm not sure if we are saying the same thing with different words, but there is no limit to "maximizing profits". They have raised their prices as high as they could, without, like you said, losing a significant amount of subscribers. The savings from the Apple commissions had 0 impact on the new prices.

Sometimes a lower price can actually mean higher profits because it generates more sales/subscribers.

Absolutely. That's what I refered to as the sweet spot. But that still means they are selling at the highest price they can (because they make the lower profit up with higher sales numbers). Any higher would mean lower sales numbers. Any lower would mean less profit per sale.

Being able to reduce costs, such as not having to pay a 30% commission, can potentially help achieve this.

It only helps to increase profits. Reduced costs are not passed on to consumers (Note: the exception being if due to market or demographic changes, the sweet spot between profits and volume changes. Another exception can be to gain market share, which depending on industry, is of questionable benefit (see smartphone market)).

 

[Belifant]

I just don’t get it. What is so difficult about using web browser once to signup for a service and save money every month?

I think we all agree that subscriptions are getting out of hand and it is hard to keep track of how many different subscriptions we pay every month.

At least everything Apple (and apps) related is convienently in one place, easy to manage and keep track of. It is beneficial to users. Corporations, such as Disney in this case, love to hide your subscription from you so you forget that you are paying for it (and how much).

 

[scorpio vega]

Mr. a$$le brought technology in the past. We had the new idea of a browser, to get rid of "tucows" (if you are an experienced guy you know what I mean), then he brought this stupid idea to use an app for everything.

You call it stupid. I call it brilliant. In order to use the browser for everything I would have to keep switching tabs for one app to use various websites when I have individual apps.

Never mind the control I have over apps (say tinder and Facebook) vs having to control the settings of the browser to make the website version better.

Apps are usually optimized and faster than the website.

Many apps have offline functionality that you don’t get using the browser.

App integration in your mobile device exists but less so if at all with accessing the website through the browser.

Ease of notifications

App use the $1500 phones features, browsers don’t.

That doesn’t mean websites Don’t have their purpose.

I use desktop office. I’ve never used office on my iPhone.

When I shop on Amazon it’s usually on the desktop.

When I was searching for directions I used the website for google maps on my iPhone.

I would hate for apps to be de emphasized because solely relying on web pages and web apps is archaic.

 

[scorpio vega]

I just don’t get it. What is so difficult about using web browser once to signup for a service and save money every month?

Because now when I want to cancel or modify something I have to go to the individual website. Half the time I don’t even remember the email or a password I even used since I made it simply to use the app.

Whereas before all my subscription were in one unified place.

Also signing up was fast. I simply had to use my Apple ID and I was good.

Now I have to type all the info in and then go to the email to verify.

Oh and what discount? Most of these apps aren’t offering discounts if you sign up through them lol.

It’s inconvenient but because it hurts apple that’s all that matters.

 

[webkit]

I'm not sure if we are saying the same thing with different words, but there is no limit to "maximizing profits". They have raised their prices as high as they could, without, like you said, losing a significant amount of subscribers. The savings from the Apple commissions had 0 impact on the new prices.

I'm not sure what you mean by there’s "no limit" to maximizing profits. The limit is the point where a higher price causes profits to start decreasing due to decreasing sales/subscriptions. Without knowing overhead costs, marginal revenue, marginal cost, and other factors, there's no way to know what type of impact Apple commissions could have. You can't automatically conclude it is zero.

Absolutely. That's what I refered to as the sweet spot. But that still means they are selling at the highest price they can (because they make the lower profit up with higher sales numbers). Any higher would mean lower sales numbers. Any lower would mean less profit per sale.

If they are going to attempt to set a price that maximizes profits, that price is impacted by reduced costs such as not having to pay Apple commissions. Therefore, Apple commissions can indeed have an impact on prices by lowering costs which can allow them to lower the price which can increase sales/subscriptions, and increase total profits. Again, without knowing overhead costs, marginal revenue, marginal cost, and other factors, there’s no way to know what type of impact Apple commissions could have.

It only helps to increase profits. Reduced costs are not passed on to consumers (Note: the exception being if due to market or demographic changes, the sweet spot between profits and volume changes. Another exception can be to gain market share, which depending on industry, is of questionable benefit (see smartphone market)).

Reduced costs, at least a portion, absolutely can and sometimes should be passed onto consumers. Lower costs can allow a company to lower the price such that it generates greater sales/subscriptions profits. It depends on things like price/demand elasticity, price sensitivity, and other factors.

 

[Belifant]

I'm not sure what you mean by there’s "no limit" to maximizing profits. The limit is the point where a higher price causes profits to start decreasing due to decreasing sales/subscriptions. Without knowing overhead costs, marginal revenue, marginal cost, and other factors, there's no way to know what type of impact Apple commissions could have. You can't automatically conclude it is zero.




If they are going to attempt to set a price that maximizes profits, that price is impacted by reduced costs such as not having to pay Apple commissions. Therefore, Apple commissions can indeed have an impact on prices by lowering costs which can allow them to lower the price which can increase sales/subscriptions, and increase total profits. Again, without knowing overhead costs, marginal revenue, marginal cost, and other factors, there’s no way to know what type of impact Apple commissions could have.




Reduced costs, at least a portion, absolutely can and sometimes should be passed onto consumers. Lower costs can allow a company to lower the price such that it generates greater sales/subscriptions profits. It depends on things like price/demand elasticity, price sensitivity, and other factors.

We kind of agree halfway, but not all the way through.

The new increased prices were set regardless of the Apple commissions. And it has nothing to do with their overhead costs etc either. It's a result of market research. They concluded they can raise the prices this much without losing too many customers. If they still had to pay the Apple commissions, the new prices would not be 30% higher than they are now. Because then it would hurt their subscriber numbers. And the same goes the other way. They concluded that lowering prices further does not increase their subscriber numbers any more. It would just mean making less profit.

Let me make a simple example:

I can produce a smartphone that costs me $100 to produce. I'll sell it for $10'000. So I make $9900 profit per device. Huge profit per device, but I will only sell a few.

The other option is, I sell the phone for $200. I make 100$ per device, but I will sell in huge numbers.

So which price do I set to make the maximum amount of total profit? That depends on how many devices I think I can sell for each price, the correct sweet spot is probably somewhere in the middle of the two extreme.

Now, for whatever reason the costs to produce the smartphone falls to $80. Does it make sense no lower to price by $20? No, because there is a finite number of potential customers. Sure, I may gain a few more customers than I would not have otherwise, but if I have done my research right, the increased sales will not make up for the lower profit per device.

Reduced costs, at least a portion, absolutely can and sometimes should be passed onto consumers.

That's assuming to price of consumer goods are simply production costs + R&D + margins = consumer price. Which is not the case. The end-consumer price is set first, and then each area of the product gets a "budget". If my hardware guys want to put a screen in the smartphone which would cause it go beyond their hardware budget, they would have to find cost savings somewhere else.

 

[webkit]

We kind of agree halfway, but not all the way through.

The new increased prices were set regardless of the Apple commissions. And it has nothing to do with their overhead costs etc either. It's a result of market research. They concluded they can raise the prices this much without losing too many customers. If they still had to pay the Apple commissions, the new prices would not be 30% higher than they are now. Because then it would hurt their subscriber numbers. And the same goes the other way. They concluded that lowering prices further does not increase their subscriber numbers any more. It would just mean making less profit.

Let me make a simple example:

I can produce a smartphone that costs me $100 to produce. I'll sell it for $10'000. So I make $9900 profit per device. Huge profit per device, but I will only sell a few.

The other option is, I sell the phone for $200. I make 100$ per device, but I will sell in huge numbers.

So which price do I set to make the maximum amount of total profit? That depends on how many devices I think I can sell for each price, the correct sweet spot is probably somewhere in the middle of the two extreme.

Now, for whatever reason the costs to produce the smartphone falls to $80. Does it make sense no lower to price by $20? No, because there is a finite number of potential customers. Sure, I may gain a few more customers than I would not have otherwise, but if I have done my research right, the increased sales will not make up for the lower profit per device.

How do you know for sure that the new prices were set regardless of Apple commissions? Perhaps they initially planned to raise prices more but decided a lower price would be better (for reasons already discussed) and in order to achieve the lower cost and price they then decided they would change how signups and payments can be handled through the App Store starting in October.

Again, without knowing overhead costs, marginal revenue, marginal cost, and other factors, there's no way to know what type of impact Apple commissions did or could have. The “maximizing profit” is about maximizing total profit not necessarily per device/product/subscription profit.

That's assuming to price of consumer goods are simply production costs + R&D + margins = consumer price. Which is not the case. The end-consumer price is set first, and then each area of the product gets a "budget". If my hardware guys want to put a screen in the smartphone which would cause it go beyond their hardware budget, they would have to find cost savings somewhere else.

Not necessarily. It can factor in a variety of things including overhead, margins, price/demand elasticity, price sensitivity, etc.

 

[Belifant]

How do you know for sure that the new prices were set regardless of Apple commissions? Perhaps they initially planned to raise prices more....

They did not plan to raise them more than they did because then it would have hurt their subscriber numbers, therefore lowering profits instead of raising them.

to achieve the lower cost and price they then decided they would change how signups and payments can be handled through the App Store starting in October.

Oh they absolutely wanted to reduce their costs too, which is a constant across every industry. There are 2 ways to increase profits: 1. raise prices. 2. reduce production costs. Disney boldly did both at the same time.

What I'm saying is that reducing costs and raising prices works independently from each other.

Again, without knowing overhead costs, marginal revenue, marginal cost, and other factors, there's no way to know what type of impact Apple commissions did or could have.

We do not need to know that, since lifestyle articles/services mostly use made up prices. Look at what a Jeans or a perfume costs vs its production costs. They cost what the market is willing to pay.

The “maximizing profit” is about maximizing total profit not necessarily per device/product/subscription profit.

Hence my example with the smartphone. There's a precise balance between units you can sell vs profits per unit which will give you the maximum total profit.

Not necessarily. It can factor in a variety of things including overhead, margins, price/demand elasticity, price sensitivity, etc.

Sorry, that's just not how it works for lifestyle articles. The price is set first, and then everything you listed above is factored in.

Of course, having said all that, these factors are all highly dynamic. Hence the huge amount of money these companies spend on market research (and their obsession with user data).

 

[webkit]

They did not plan to raise them more than they did because then it would have hurt their subscriber numbers, therefore lowering profits instead of raising them.

You cannot say that for sure. They may have planned to raise prices more because existing costs made it necessary but then decided to lower costs (by eliminating Apple commissions) which allowed them increase prices less in order try to keep/add more subscribers (due to the lower price) and as a result help increase total profits.

Oh they absolutely wanted to reduce their costs too, which is a constant across every industry. There are 2 ways to increase profits: 1. raise prices. 2. reduce production costs. Disney boldly did both at the same time.

What I'm saying is that reducing costs and raising prices works independently from each other.

A reason for reducing costs can also include wanting to lower prices in order to increase sales/subscriptions which could potentially increase total profits.

We do not need to know that, since lifestyle articles/services mostly use made up prices. Look at what a Jeans or a perfume costs vs its production costs. They cost what the market is willing to pay.

We do need to know that. The fact that products cost "what a market is willing to pay" does not mean overhead costs, marginal revenue, marginal cost, and other factors still don't play a significant role when it comes to trying to maximize profits.

Hence my example with the smartphone. There's a precise balance between units you can sell vs profits per unit which will give you the maximum total profit.

As I said, "maximizing profit" is about maximizing total profit not necessarily per device/product/subscription profit. This can involve several factors.

Sorry, that's just not how it works for lifestyle articles. The price is set first, and then everything you listed above is factored in.

Of course, having said all that, these factors are all highly dynamic. Hence the huge amount of money these companies spend on market research (and their obsession with user data).

It is how it works. Overhead, margins, price/demand elasticity, price sensitivity, etc. can all play significant roles. To suggest that prices here can essentially just be "made up" and costs, margins, price/demand elasticity, price sensitivity, etc. have little impact is simply wrong.

At this point, there's probably no need to continue this back and forth discussion as we are likely boring most thread readers.

 

[Jamie0003]

My point is that if they scream about how they can save us money/better for consumers by going to their own system, that going to their own system should actually save us money or be better for us.

It is already established that it is less convenient (number of clicks, not a central hub, darkweb tactics to keep you from unsubscribing, etc). So even at cost parity, it is worse for consumers. So where does the 'better' part come from?

They sure didn't mind riding on the coattails of the success of the App store to get off the ground. Now they are big bad because Apple is making money while they are bleeding off through crap shows like "The Acolyte."

I would much rather put up with Apple BS that get routed through a retention expert who explains to me like I am an idiot for not realizing that the only time to cancel my subscription is at the stroke of midnight on the second Tuesday of the week and during a blood moon - and then 'accidentally' disconnects me. And MAJOR players pull crap like this. Somewhere on YouTube was a phone conversation where a guy spent 45 minutes trying to cancel service that he wasn't even getting, and the company not letting him do it. I could have made another one with SiriusXM.

Yeah, I don't miss that crap. So yes, having Apple go to bat for me and just turning that crap off works quite nicely.

Why are you defending the trillion dollar company here? They shouldn’t even be allowed to take that 30%. They aren’t running the service are they?

 

[Belifant]

agreed. I assumed I made my point clear enough. What you say is not neccessarly wrong and indeed applies to many cases and industries. Just not to this specific example in this thread.

At least we kept it without insults, that's not a given these days. 🤝

cheers

 

[v3rlon]

Why are you defending the trillion dollar company here? They shouldn’t even be allowed to take that 30%. They aren’t running the service are they?

Why are you defending a $175 billion company here and their right to pull all of the crap I mentioned above, which every person I have ever met actively hates. They don't just no like those tactics. They seriously despise them. Do you like subscriptions you can't cancel?

So again, where does the 'better' part for the consumer come in? They argued in court over and over how this is better for me. More time and more mouse clicks to cancel a service is not 'better.' Same or higher cost is not 'better.' Dark web tactics like hiding the unsubscribe or limiting the chances for it is not 'better.' Charging to unsubscribe is not 'better.' Not having one central hub where I can see what my subscriptions are costing me (and even compare them to each other should I need to cut expenses) is not 'better.' Is anything about this actually better for ME the consumer? Think of all the money they could have saved by NOT litigating this. They could have filmed and entire season about Happy Hogan and how all he ever really wanted was to join the ballet AND paid for a marketing campaign to blame the fans when it tanked because no one watches the MCU to see the ballet (we have John Wick for that).

 

[I7guy]

Why are you defending the trillion dollar company here? They shouldn’t even be allowed to take that 30%. They aren’t running the service are they?

You dont have to opt in to a business relationship with that trillion dollar company. But when you do it’s all easy peasy with managing your subscription. One click.

 

[LizKat]

A Hulu (live) sub even via a direct-pay route is dead to me once again anyway once this bi-coastal World Series is over.

Was hoping for a subway series after muh Guardians lost the ALCS to the Yanks. But the Mets couldn't quite make total magic out of their NLCS efforts either, so no subway series, and I'm not really a fan of either the Yanks or LA Dodgers past the fun of imagining a time-warped take on a Brooklyn Dodgers v NY Yankees series. Yeah I'm that old.

So all that's left for me to care about on Hulu Live after the World Series is... well, stuff we don't discuss on MacRumors any more in the interests of staying on board with a MacR reggie. Cheers! Don't forget to vote...

 

[Abazigal]

Why are you defending the trillion dollar company here? They shouldn’t even be allowed to take that 30%. They aren’t running the service are they?

There's nothing to defend here. It's just another day in business.

Disney was initially happy to pay that 30% to Apple (which gets reduced to 15% after the first year) for customer acquisition (ie: the ease of downloading the disney+ app and subscription to a new account via iTunes). This shows there is initial value in going through the App Store (eg: why not just get customers to sign up via their website right from the very start? Because Disney knows the added friction will likely result in a lower take-up rate, and 70% of something is better than 100% of nothing).

That Disney is not supporting this anymore just says that they have utilised the App Store as much as they could, and those resources could now be channeled elsewhere. The number of people subscribing to Disney+ has more or less stabilised. This should be the key takeaway from this whole incident.

What we may see in the long run is a drop in the number of paid subscriptions reported by Apple, though it will probably not have a noticeable impact on overall services revenue.

So like I said - another day in business.