INTERNATIONAL - Spotify and Hulu LLC will
sell students their music and video services for a combined price of $4.99 a
month a $13 discount in a bid to sign up young customers for a new kind of
entertainment bundle.
Students enrolled at US Title
IV-accredited colleges or universities can sign up for the Spotify package,
which will now include a subscription to Hulu’s ad-supported video service, the
companies said Thursday in a statement. Hulu and Spotify will split the
subscription fee, and Hulu will sell ads. This is the first time
Stockholm-based Spotify has packaged the largest paid music-streaming service
with another company’s movie or TV product. Hulu, based in Santa
Monica, California, offers
customers reruns of “Homeland” and “South
Park,” as well as
original series “The Handmaid’s Tale” and “The Mindy Project.”
“By bundling our enormous
catalogs of content together in a single, highly compelling offer, we’re making
it easier for people to enjoy all of the TV and music they love, whenever and
wherever they want,” Hulu’s head of distribution and partnerships, Tim
Connolly, said in a statement. Hulu and Spotify are two
leaders of a new class of Entertainment Company offering songs and TV shows
on-demand for a monthly fee over the internet. The growth of these services
coincided with a decline in customers for traditional pay-TV services, whose
bundles of dozens of cable channels cost far more than a monthly subscription
to Netflix or Hulu.
Bundling Offerings
The proliferation of
options, from Netflix to more-niche services like Crunchyroll and Brown Sugar,
led many analysts to predict companies would eventually bundle their offerings
in a manner reminiscent of a pay-TV package. Amazon.com Inc. is already attempting
this with its Prime shipping, which includes subscriptions to video and music
services, and another program called Channels.
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A deal aimed at students
could lead to further collaborations between Hulu, which is looking to gain
ground on larger rival Netflix, and Spotify, which can use video services to
retain customers who might be lured to rival Apple Music. Spotify has more than
60 million paid subscribers, and more than 140 million users in total.
Young students with limited
disposable incomes are among the most elusive customers for vendors of paid
media services. Comcast Corp., the largest US cable provider, offers a special
cable package to students at about 100 campuses.