Hulu Looks to Restructure Itself into an On-Demand Subscription Product - The UpStream

Hulu Looks to Restructure Itself into an On-Demand Subscription Product

posted Saturday Jan 29, 2011 by Nicholas DiMeo

Hulu Looks to Restructure Itself into an On-Demand Subscription Product

Hulu has tried to stick to their guns as long as it possibly could, with creators of the service doing everything in their power to get users to support the free-with-ads business model they have been running with. Unfortunately, the bigger guns behind the content Hulu provides is threatening to back out and pull shows and movies unless Hulu can find a way to monetize the users that come to the site, and fast. We have heard rumors of Hulu considering restructuring their business model and moving towards an Internet-based television provider that users would subscribe to, similar to the way they would for satellite or cable TV. With providers like Disney and News Corp threatening to pull their free broadcasting, Hulu better do something quickly, especially when these companies are able to make money with services such as Netflix, Apple and Microsoft.

That repackaging, however, is just one of the options we've heard tossed around the Inter-tubes this week. Follow after the break for more on the other possibilities.

We've also received word that Hulu might go the way of a tier-based subscription, where consumers would pay for levels of content. What this means is that we would most likely see only the very recent broadcasts stay on the free service, with the other trailing episodes going into the tiered system. It's also possible that we might see them work out deals for content that is exclusive to Hulu or maybe even hold certain series' episodes for weeks before putting them online, like networks already do with a select number of current shows.

This all comes on the heels of their Hulu Plus launch, that allows you access to an entire series. However, the service has been less than impressive for the media giants. With people already having some other subscription like Netflix, $7.99 per month just isn't enticing enough for most potential subscribers. We actually learned that the $4.99 price cut we heard about back in October was something Hulu CEO Jason Kilar agreed upon, but that they bumped the price to $7.99 so everyone involved would make a little more money.

It goes even further than that. Hulu, as of right now, has access specifically on the PS3 and the computer, with limited access coming to Xbox LIVE in the future. Rivaling company Netflix has allowed users to essentially use whatever device they wish, set-top boxes included. It makes sense that Netflix is seeing huge success and that Hulu wants to seek out the gold as well. Hulu could definitely move into an on-demand subscription service and if they provide a lot of the right content, ahead of its competitors, at the right price, we could see things turn around for them. It looks like the new-age format/streaming war is starting to heat up even more!


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