Will Hulu become a subscription Web video site?
Why not? Perhaps what we see now is the freemium version and one with a full library of shows may end up as Hulu on an HDTV – by cable subscription only.
And if this strikes anyone as crazy, and some will scream about it, just think of Netflix, ESPN360 and cable. Netflix started with a subscription video offering (rolled into their DVD rental subscription), and now offers streaming video on demand to the large screen through Tivo, XBox 360 and other TV connected devices (and expect to see it built into broadband connected TVs this year). Basic cable is a package of video channels with commercials. And ESPN360 is only offered through broadband providers with which it has an agreement.
The cable executives continue to communicate the general business message that this is a workable. Comcast CEO Brian Roberts supports the "TV Everywhere" authentication approach (Comcast calls is OnDemand Online) put out by Time Warner CEO Jeff Bewkes. And Jon Miller, head of digital at News Corp was reported by AOL’s Daily Finance blog as saying Hulu could be placed behind a pay wall. Will Richmond at VideoNuze makes some good points as to why Hulu may one day go subscription (or at least, freemium and premium).
Will it work? Content producers, like any business, need a certain amount of revenue to survive and thrive. As we’ve seen with TV and print (radio, until satellite, didn’t have many good options), the best content can command subscription revenues with higher profits, even at the cost of traffic, should owners choose.
If the model moves in a direction of premium content arriving via subscription models, we may also see more mass marketing of these premium broadband “channels.” This could change the nature of Web properties resulting in top properties being those cable companies decide to push (similar to TV today). While this is all just theory today, the talk of executives and the need for the Hulu’s of the world to prove themselves as solid financial models mean that the future may be just around the corner.
(disclosure: the author does work with Web video companies)
