Hulu Ditches 'Free' Model Without Giving It A Chance To Succeed
from the the-illusion-of-disruption dept
For years we've noted how as a product of the cable and broadcast industry, Hulu has often gone out of its way to avoid being truly disruptive. Owners 21st Century Fox, Disney and Comcast/NBC have worked hard to ensure the service is never too interesting -- lest it cannibalize the company's legacy cable TV cash cow. So Hulu has been doomed to walk the halls of almost but not quite compelling purgatory, a rotating crop of execs for years trying to skirt the line between giving consumers what they actually want -- and being a glorified ad for traditional cable television.Fast forward to this week, when Hulu announced that the company is backing away from free as a core component of its business model. While Hulu began as a free option, it has slowly but surely been making free content harder to come by. Instead, users now have the option of paying either $8 per month for a streaming service with ads, or a $12 per month service (mostly) free of advertising. As such, the company proclaims that offering anything for free is no longer part of the company's vision of the ideal "Hulu experience":
"For the past couple years, we’ve been focused on building a subscription service that provides the deepest, most personalized content experience possible to our viewers,” Hulu senior VP and head of experience Ben Smith said in a statement. “As we have continued to enhance that offering with new originals, exclusive acquisitions, and movies, the free service became very limited and no longer aligned with the Hulu experience or content strategy."Instead, Hulu intends to focus on its subscription services, and the launch of a live TV subscription platform sometime in early 2017. It will offer some free content 8 days after a program's air date, but only via a new Yahoo/Verizon web portal that may or may not even exist next year at this time. Thanks to intentional release delays, a shrinking catalog of free options and other restrictions you'll note Hulu can't specifically claim that the free business model failed, because it was never truly given a chance to succeed.
And because this is the cable and broadcast industry, Hulu's "content strategy" will remain hamstrung by all manner of unnecessary restrictions. Time Warner, which recently paid $583 million for a 10% stake, has been pushing to pull all current seasons of shows from the service. It's also worth remembering that the 2011 NBC Universal merger conditions blocked Comcast from meddling in Hulu management (not that this always stopped Comcast) to prevent anti-competitive shenanigans. But those restrictions will sunset in early 2018, at which point ownership pressure to ensure Hulu isn't too disruptive will only grow.
So on one side, you have Hulu claiming it wants to become disruptive and profitable. On the other side, you have its owners intentionally doing things to ensure it never becomes too disruptive and profitable. And offering free services as part of your business model certainly doesn't line up with the goal of keeping the legacy cable industry cash cow happily mooing for another decade. As we've long noted, most cable and broadcast companies think this whole cord cutting thing is a fad that ends when Millennials start procreating. As such the focus is on the illusion of innovation while they wait for the storm to pass.
While ditching free may not be a great idea, the real threat to the viability of a streaming revolution remains exclusive licensing and fractured content availability. As broadcasters increasingly focus on their own streaming services, exclusive arrangements (like CBS with Star Trek) are flourishing. In Hulu's case, it means losing access to the CW network, now exclusive to Netflix. It also means losing access to the Criterion Collection of films, now the streaming exclusive of a new Turner-owned streaming platform called Filmstruck. This fractured availability only frustrates and confuses customers, many of which will simply return to piracy.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Reader Comments
The First Word
“I used to pirate TV until Hulu came along. Now I shall return to pirating tv.
Subscribe: RSS
View by: Time | Thread
[ link to this | view in thread ]
I used to pirate TV until Hulu came along. Now I shall return to pirating tv.
[ link to this | view in thread ]
[ link to this | view in thread ]
[ link to this | view in thread ]
There is plenty of other entertainment options these days than TV shows
[ link to this | view in thread ]
Screw Hulu!!!
Watching video... this one has ads just because... WTF!!!
Well shit! I cancelled my subscription!
Fuck you Hulu, you lying sons of bitches! Fuck you FTC for letting companies repeated lie to consumers in their marketing campaigns without punishment!
[ link to this | view in thread ]
[ link to this | view in thread ]
Hulu used to be nice, until they broke get_flash_videos
[ link to this | view in thread ]
Re: Screw Hulu!!!
[ link to this | view in thread ]
Re: Screw Hulu!!!
But get angry at them if you want because a tiny handful of shows still had commercials.
[ link to this | view in thread ]
Re: Hulu used to be nice, until they broke get_flash_videos
[ link to this | view in thread ]
[ link to this | view in thread ]
'Mission accomplished'
"We're not withholding our content from Service X because it directly competes with our offerings, we're doing it because such services are unsustainable and aren't viable alternatives to traditional offerings, and as such it would be a waste of time and money to do so. It would also potentially cost our customers if they signed up for a service only to have to go under a year or so later."
[ link to this | view in thread ]
Re:
[ link to this | view in thread ]
PArt of HULU since the start..
It WAS Good, then BAD, then Good, then WORSE...
They got rid of FORUMS, a few years back..They got tired of the complaints..
But WHO is behind HULU??
HOW many Corps have contracts and restrictions, and BS over content..And they CHANGE every time we turn around..
If HULU is independent, they could of Done better..and KICKED the CORPS OUT, until they figured out the NEW SYSTEM..
IF they are PART of the CORP system, they are idiots..
[ link to this | view in thread ]
Re:
[ link to this | view in thread ]
Re: Re: Hulu used to be nice, until they broke get_flash_videos
[ link to this | view in thread ]
A strategy for fighting a large fire is to light a small fire to create a burnt-out zone. With no fuel to expand, the fire is contained.
Hulu looks as if it was created to suck the life out of nascent competitors, and to "prove" to VCs that no similar model could be profitable.
Except that Netflix, YouTube and other flanked that line and are filling in behind with original programming. And, in YouTube's case, clips that have the key content.
[ link to this | view in thread ]
"90% of everything is crud"
As Sturgeon observed (in response to someone else saying 90% of sci-fi is crud) 90% of everything is crud, and our content creators (professional or otherwise) are only guessing at what makes something good, or not.
The habits developed by media piracy actually lead to a better chance of picking out the non-crud from the crud, or at least some introspection as to why a given non-crud appeals.
[ link to this | view in thread ]
[ link to this | view in thread ]
Re: Re: Screw Hulu!!!
A Antenna and a TIVO, I can record all the broadcast channels and skip past all the commercials. Add in Netflix and I already have to much to watch. Add in MeTV, and AntennaTV and other channels on the antenna, and you get a lot of great classic TV. If you haven't watched it, it's NEW to you!!!
There really isn't much need for HULU. Signing up for all these services like Netflix, HULU, SlingTV, AmazonPrime, how are you saving money. How the hell do you have that much time to watch all that TV?
A couple shows like "The Walking Dead" on AMC I'd get a season pass on Amazon. Then I can watch the show on Monday after it aired Sunday on AMC, but I'd own it and it would be Commercial free. I get the SD version which looks just fine. With all the savings, it's a drop in the bucket.
[ link to this | view in thread ]
Re:
If you're going to have the service, you have to just pay the $13 for the so called commercial free version!!! Net as always Netflix is cheaper and there's not a single commercial anywhere. Their Original content is far better. I have my Antenna and a Tivo for the Broadcast channels. I record everything before I watch so that I can skip commercials!!! Hulu? No thanks!!! A service owned buy the same old content providers. What did people think was going to happen? It's always sucked, it's just worse now.
[ link to this | view in thread ]
[ link to this | view in thread ]
Crap and bloat
I canceled and won't be going back.
[ link to this | view in thread ]
[ link to this | view in thread ]
Re: Re: Screw Hulu!!!
[ link to this | view in thread ]
Re: Screw Hulu!!!
[ link to this | view in thread ]
[ link to this | view in thread ]
Regardless, they only had one thing I was interested in; The uncut episodes of the 1995 Outer Limits. The idiots at the Canadian company who released the DVD sets of seasons 2-7 used the censored syndication versions. Hulu had the Showtime copies. Unfortunately I was never able to find a way to download them.
[ link to this | view in thread ]
Re:
[ link to this | view in thread ]
[ link to this | view in thread ]