Hulu has revolutionized the way we watch television.
Where before, in the primitive age of 2007, we had to rely on such archaic technologies as DVR’s and TiVo to record and watch reruns of “The Office” or “Family Guy,” television enthusiasts across the nation can now experience the same “catch-up viewing” experience for free online, from the comfort of … wherever.
Hulu, the joint venture between News Corp.’s Fox, General Electric Co.’s NBC Universal and Disney’s ABC, provides media streams of full episodes and excerpts from current TV shows as well as a handful of full movies — all for free with the assistance of sporadic, unskippable advertisements.
However, these glory days may soon be numbered.
Last week News Corp. Deputy Chairman Chase Carey opened the B&C OnScreen Summit by announcing Hulu’s plans to start charging for content as soon as 2010.
“It’s time to start getting paid for broadcast content online,” Carey said. “I think a free model is a very difficult way to capture the value of our content. I think what we need to do is deliver that content to consumers in a way where they will appreciate the value. Hulu concurs with that; it needs to evolve to have a meaningful subscription model as part of its business.”
The sky darkened, the ground shook, as millions of angry Web geeks stormed the Internet to protest Hulu’s desire to turn a profit.
But wait just one minute before you remove Hulu from your bookmarks list — Hulu executives have yet to announce exactly what content will be limited under the 2010 pricing model.
Instead of asking: “How much would you pay for Hulu?” We will likely be asking: “How much would you pay for Hulu Plus?”
Media and technology analyst and blogger Peter Kafka wrote, “[Hulu] doesn’t plan on charging people to watch the stuff it’s currently airing on the site…But Hulu is trying to figure out how to create some kind of premium offering where you’ll pay for stuff that isn’t on the site right now.”
What this could translate into is a “Hulu Plus” subscription package that would perhaps offer a larger selection of movies and TV episodes, as well as access to some more exclusive channels such as HBO and Starz.
The idea of paying for content will put a sour taste in anyone’s mouth, but perhaps it is best to put this model into perspective.
While prices vary, digital cable usually runs roughly $50 per month. Add HBO and Starz and that figure will rise to $90, or higher.
Add to that the costs for TiVo and Pay-Per-View and … well, you get the idea.
The new Hulu model would allow the company to profit from a reasonable monthly subscription fee as well as pay-per-watch streaming content (a la Netflix and iTunes), without exterminating the lifeblood revenue it receives from advertisements (a la YouTube).
It’s a smart idea, and one that could serve as an excellent profit model for other Web 2.0 companies such as YouTube and Netflix to consider.
The days of free TV online may be numbered, but hopefully the folks behind Hulu are smart enough to offer enough new goodies to encourage viewers to buy their premium pass and to set it at a price that is both affordable and reasonable for the content it unlocks.
The Internet: the last free frontier. It was fun while it lasted, I guess.
Hal is an accounting major and is debating whether he himself would pay for a ‘Hulu Plus.’ Just to be safe, send him your torrent links at
hscohen@asu.edu.
