Hulu May Begin Charging for Content

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News Posted: Fri, Jun 5 2009 6:56 PM
Jon Miller, the former AOL boss, recently took over digital initiatives at News Corp. Only weeks into the job, and Miller is already making waves in the industry with his visions of a future where Hulu could charge for at least some of the TV shows and movies on its site.

News Corp. owns a sizable portion of Hulu, so when someone like Miller says it’s possible Hulu could begin charging for content, there’s a good chance that statement could come true. In addition, Miller is in charge of coordinating News Corp.’s efforts to find new ways to convince users to pay for digital content generated by News Corp.’s properties, so Miller definitely has some pull here.

However, there’s still hope for those of us who want free content: Miller notes his statements are his own opinion and not necessarily the Board's decree. In fact, Miller won’t attend his first board meeting until Monday. Still, over time, Miller’s visions could become reality.


 

News Corp. is familiar with subscription revenue models on the Web. While many papers and online news sources today are ad-supported, News Corp.'s Wall Street Journal continues to enjoy success even though much of its content is only available to paid subscribers.

Hulu’s current business model is well liked by users because they can watch high-quality content on demand with only a single advertisement per commercial break. Compared to traditional TV advertising, Hulu’s total revenues are miniscule, however. To help make up for suffering ad revenues, one obvious approach is to charge users. It’s a delicate balance, however, since charging for content could deter new users from trying the service.

For now, Miller’s interests seem to be around finding creative ways to bundle News Corp. content with other offerings in hopes of creating a package that people are willing to pay for. "I think what works for consumers most likely—and this has to be tested, frankly—is bundles," he said. "I think you have to figure out what are the right bundles that people buy and what's contained in that bundle. For example, you could have—and I'm making this up entirely—you could have a New York bundle, and that could consist of various papers or publications that are relevant to the audience in New York, and you could make that all, potentially, a bundle to a consumer at one price." Miller added that such a bundle might include a device to read it on, such as a Kindle or an iPhone, as well as the content itself.
 
 
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Hulu can charge whatever they want, but who's gonna pay (especially in this economy)!

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Dave_HH replied on Sat, Jun 6 2009 7:37 AM

Exactly.... Hulu begins to charge for content. And then that's when I begin to stop going there. It's a tough racket but in the internet biz, you have to figure out more creative ways to monetize.

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3vi1 replied on Sat, Jun 6 2009 4:08 PM

I third that opinion.  I don't think Hulu has a big enough foothold to do this except for maybe a few content items.

If they go too far with it, they'll see major competition spring up.

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Riks replied on Sat, Jun 6 2009 4:16 PM

hope they don't, just heard about this thingStick out tongue

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Well I delt with the boxee thing and I use there desktop app, which is not bad, but not as good as boxee, but if they start charging I'll just stop watching. I don't mind the ads other than the fact that they play the same one over and over again during a show.

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Yea that would be a bright idea. But I see them only havin a shot at charging for the movie side of it. As seeing as now most of the networks actually show the tv shows on there sites as well. So if they start charging its not like you just cant go to the networks site and watch the shows. Well majority of them anyways. I think it would be a bad move on there part.

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transam02:
But I see them only havin a shot at charging for the movie side of it.
Now that I could handle. I like payperview movies. As long as it was new stuff just out on DVD.

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kid007 replied on Sun, Jun 7 2009 8:50 AM

The great thing is that is HULU begin doing the "i'm greedy" then Youtube could or other website could upgrade their contents for free. That is the beauty of YOUTUBE and if they want to compete in that market NBC "HULU" better stay the way it is...

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Lev_Astov replied on Mon, Jun 8 2009 11:43 AM

If Hulu were to start charging money for its current service, it would die. I think they know that, too, so will be looking for ways to make it worthwhile. I'm pretty sure I would pay for the service if they could include shows and movies from networks like HBO or Showtime.

I would definitely pay for Hulu if it meant watching Dexter without having to pay for the whole pricey cable package. I suspect that this is what Jon is talking about.

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JeffB replied on Tue, Jun 9 2009 9:59 AM

I guess they need to pay for those "We're Aliens" commercials somehow.

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