My coffee was more interesting than the Hulu dissection this morning. Analysts wanted to know why no one was biting on their $9.99 pay-for-play deal. I sat there, laughing, silently at my desk. Really? You have no idea? None? Your lacking content is the first issue.
McDonald’s money maker is the greasy beef and fries, not the salads. Those veggies are only there as a public relations campaign. So, why is Netflix, who has no power over content, winning the internet tv/movie wars? They’re commercial free.
It comes down to simple math. Hulu: $9.99 (considering a price drop to $4.99) for movies and tv from only three studios (ABC, NBC, FOX) with commercials. No cable shows, except for limited previews. Polls still show no one is interested in commercials even with the price drop. They are also blocking their website from working on Google tv, even with a subscription price. Bad idea. If I dole out cash for your app, I want to view it- everywhere- not just on a 10 inch ipad.
Netflix’s $8.99 plan includes multiple studios including those on Hulu. Showtime, HBO, Cinemax movies usually by disc only, but still cheaper than cable tv. They’re integrated with iPod touch, iPad, Andriod phones and tablets, Wii, Ps3, Boxee, and Roku.
Hulu wants to go online with the cable tv model. They want revenue both ways; from the consumers and from the advertisers. In 3-4 years this model will work. When more mainstream Americans are buying pc integrated tvs. These are the people who still sit down on Thursday night at 9pm to watch The Office on broadcast television. Their main revenue currently is via advertising, which is nothing to snicker about. These are the people who are trained to view commercials. In the next 5-7 years when you have Generation Z (born in mid 1990′s) coming out of college and living in their first apartments, the model will have to change again. They’re not going to schedule their life around tv. This affect has already begun to cross over into people in their 30s. Generation Alpha (born after 2010), will eerily be more like myself. So Hulu will win the battle, but not the war with their current model.
The last time I scheduled my life around tv was Friends in high school. By the time I hit college, I built my first media center pc and hooked it up to an analog 13 inch tv. Which is also the last time I had television set. I got to watch my precious Jerry Springer and Oprah while not missing Organic Chemistry. Since those glory days, I haven’t watched a commercial since. I mute the ones on Hulu. CNBC plus, which I pay $9.99 for, has no commercials and is well worth it to me because I can view it online whenever I travel. Sports are the only thing that I do watch live anymore. Even then, when I watch football, I let my Windows 7 Media pc record for an hour. No point in sitting through pizza commercials.
Hulu is a major win for viewers who want to stream online media and for the studios to pull in ad revenue. The only way anyone would pay for it is if it’s completely commercial free, or, keep the commercials and throw in the cable channel Bravo (USA and Syfy’s full season shows are already available). Paying for Hulu at this point feels like I’m getting hustled in a poker game. I can get watch it for free on broadcast tv with commercials; the same goes for online.