Is ESPN’s new streaming service a ripoff?

Last week, ESPN revealed the pricing for its upcoming standalone streaming service, and it’s a bit steep. The service will set you back $30 a month, but you have the option to bundle it with Hulu and Disney+ for an extra $6. As a special launch offer, you can get both bundled services for free in the first year. That sounds like a good deal, right?

According to reports, ESPN charges cable providers around $10 per month per channel, so this new streaming service marks a 200% increase in cost for individual viewing. That might sound like a lot, but there’s a method to the madness.

ESPN’s goal with this pricey service isn’t for everyone to jump ship from cable. By setting a high price tag, they’re aiming to push viewers towards other methods of channel access, like traditional pay TV packages or newer streaming bundles. In other words, they want to make the standalone service less appealing to avoid cutting into their existing cable partnerships.

If you’re a die-hard NFL fan who can’t miss a game, you might need ESPN, Peacock, Paramount+, and Fox to catch all the action. This combination would add up to $66 per month, and opting for ad-free versions of Paramount+ and Peacock would bump it to $77 monthly. It’s not far off from the cost of a traditional cable package or services like YouTube TV and Hulu + Live TV, which run about $83 per month.

While subscribing to just ESPN may make sense for some viewers, especially when paired with an antenna for local channels, sports buffs looking for complete cable coverage may find the a la carte route more costly. Unlike general entertainment content, where swapping through streaming services can save you money, sports coverage is pricier and requires bundling or other cost-saving methods like password sharing.

The real strategy behind ESPN’s standalone service is to kickstart a new era of TV bundles. Disney has already started combining services like Hulu and Disney+ to offer savings, and ESPN’s flagship service is part of this bundling approach. It won’t be surprising if ESPN eventually joins the bundle frenzy with Disney and other partners.

Wireless carriers like Verizon have also entered the streaming bundle scene, offering packages that include Disney+, Hulu, and ESPN+. By setting high prices for standalone services, companies are steering viewers towards bundled options, which discourage subscription swapping and offer better value.

In the end, ESPN’s new streaming service is less about selling you a single sports channel for $30 a month and more about paving the way for innovative streaming bundles. It may be a shift from the old cable TV system, but it’s likely a step up from paying for every single service individually. The dream of true a la carte viewing may not be dead, but it’s definitely not what cord-cutters imagined.

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