Hulu on-demand just got a massive boost to its library from Fox, and Live can now distribute HBO and Cinemax. Do Hulu’s broadcast owners need pay TV to distribute their content anymore?
Hulu Live gets premium
The launch of Hulu Live in May of this year brought another strong competitor to the virtual MVPD market pioneered by Sling TV. The slick integration between the on-demand content from Hulu with live TV and DVR’d shows caught the markets attention immediately. It also offers solid consumer value with 59 channels for $39.99 a month. However, until now consumers could not access premium channels through the service.
Last week, Hulu announced that subscribers to Live and on-demand packages can subscribe to HBO for $14.99 a month and Cinemax for $9.99. Customers will get access to HBO’s and Cinemax’s East and West Coast live feeds through service. The many other live channels will become available in the coming weeks, including channels like HBO 2, HBO Latino, and MovieMAX HD.
Of course, this nothing new. Sling TV, DirecTV Now, and PlayStation Vue also allow customers to subscribe to HBO and Cinemax. However, Hulu Live offers a nice bonus. Customers will be able to access HBO’s own branded service, HBO Now, through their Hulu account.
Fox boosts Hulu on-demand library
Hulu announced a deal with one of its investors, Fox, that brings a huge library of TV content to the on-demand service. 20th Century Fox Television is licensing 3,000 episodes of 26 shows to Hulu. Recent shows like Bones, How I Met Your Mother, and Glee join classics like Hill Street Blues and The Mary Tyler Moore Show. Hulu will also be the only site with all 11 seasons of M*A*S*H and all episodes of NYPD Blue.
Last week Hulu completed another deal with 20th Century Fox Television. It added all episodes of animated series Bob’s Burgers, American Dad, Futurama, and The Cleveland Show.
Market progress on all fronts
Hulu on-demand continues to grow strongly with the overall market for SVOD services. According to TiVo/Digitalsmiths data, 6.2% of US consumers were using Hulu in Q1 2015. By Q1 2017, 7.8% of consumers reported using the service. The company has also retained its position as the third most popular SVOD service. Amazon is the second most popular with 18% of consumers saying they use it in Q1 2017, and Netflix is number 1 with 36%.
There is one area where Hulu is number one: Hulu viewers watch more video on the service than any other. According to comScore, Hulu viewers watch 2.9 hours a day versus 2.2 hours for Netflix, and 2 hours for Amazon. comScore also says the virtual MVPD side of the house, Hulu Live, is driving a lot of viewing. Hulu Live delivers 9% of total time spent watching all the vMVPDs, despite being only a few months old.
Hulu on-demand and Live are better together
Though both the Live and on-demand deals separately strengthen each product offering, the real payoff for Hulu and its customers is in the combination of the two services. Bringing together new, recent, and library television content in a single interface is a unique value proposition. It should encourage customers to use the service more, and help bring new customers to the Live service.
It’s also demonstrates the power of the Internet to cut out the middle man. Hulu’s broadcaster owners (ABC, NBC, Fox, and Turner) now have a service that is a credible competitor to their traditional distribution partners, the pay TV operators.
Why it matters
Hulu is boosting content in both its on-demand and vMVPD products.
This helps both offerings separately but benefits the combined offering much more.
Hulu is now a credible competitor to pay TV and is an example of the Internet cutting out the middleman in distribution.