Last week, Hulu launched its much-awaited skinny bundle service, priced at $40 per month. The service includes content from major broadcast networks, several cable networks along with Hulu's own programming. The "Hulu Live" service is still in beta, and does not include content from Viacom or Discovery networks.
It also comes with limited DVR functionality, with fast-forwarding through ads disabled. But for another $15, subscribers can skip ads and get 200 hours of storage (versus 50 hours at the basic tier). They can also run unlimited concurrent streams for the same amount, or add both features for $20.
Hulu LLC 's launch of a skinny streaming service follows launches by Dish Network LLC (Nasdaq: DISH) (Sling TV), Sony Corp. (NYSE: SNE) (PlayStation Vue), YouTube Inc. and DirecTV Group Inc. (NYSE: DTV) (DirecTV Now), but it appears to have the broadest selection of high-value content. It's also a little on the high side price-wise, at $40 per month.
Hulu hasn't been profitable for its owners, and it probably hopes that it will be able to do with Hulu Live what it couldn't with its standard OTT streaming service. Or perhaps it's relying on new advertising revenue to bring profitability. Hulu Live will reportedly sell local advertising on the cable networks it carries. This is similar to the "avails" offered by cable networks to pay-TV operators -- two minutes per hour of advertising. Hulu already sells advertising on its ad-supported OTT streaming service.
Cable operators have been able to build substantial local advertising businesses, with SNL Kagan forecasting that cable operators' advertising revenues would hit $6.3 billion in 2026. But it is a scale game: Comcast and Charter combined already account for about $4 billion.
For more information and analysis on the Hulu Live launch, please see Hulu Live Launches in Beta on Light Reading.
— Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation