In the streaming wars, we could call this one Hulu strikes back. As of Sept. 2nd, 2015, the popular streaming company Hulu has added a third level of viewing. They have made quite a bit of news lately, with the Epix, Seinfeld, and South Park deals. For $11.99 a month, you can stream TV shows and movies commercial free. This move is an attempt to make Hulu more competitive with the other two major US companies, Netflix and Amazon.
Hulu’s CEO, Mike Hopkins, feels one of the big problems they faced, was the lack of a commercial-free option. As an example, people wanted to enjoy Seinfeld, but complained about commercials. Hulu listened to that complaint, and came up with the price point of $11.99. The company calculated the extra four dollars would make up for the advertising revenue lost.
This $12 price is 50% more expensive than it’s biggest competitor, Netflix and almost that much for Amazon. Neither Amazon nor Netflix show commercials in their streams, and they both have large libraries. Of course, you can do something on Hulu that you are not able to do on the other two, watch certain episodes of shows and movies for free (commercial supported). Though commercial-free streaming may be a step in the right direction for Hulu, it still leaves some questions open.
At this time, Hulu has around 9 million subscribers vs. the 41 million that Netflix has. Despite having some great shows like Seinfeld and South Park, the question is will people be willing to pay the extra $4 a month just to see their shows without commercials? For some of the existing members that are already using the “limited commercial” model, it may we worth it to them to pay the difference. As far as growing membership goes, Hulu is either going to have to drop the price on the service to get it more inline with it’s competitors, make more really good original programming, or get more exclusive rights to shows. If their goal is to get people to switch, and they are using a commercial-free Seinfeld as a draw, the public can obtain all seasons of Seinfeld legally at a reasonable price, and have it in two days from Amazon.com.
