Hulu Eyes Cable-Like Bundle – Report

The answer to the break-up of the cable bundle is... another bundle!

According to a report by The Wall Street Journal, Hulu LLC is planning to launch a subscription online video service in early 2017 that would compete with linear services from traditional pay-TV operators. The new offering is also expected to include a cloud DVR feature.

Other big names, including Apple Inc. (Nasdaq: AAPL) and Microsoft Corp. (Nasdaq: MSFT), have fought and failed to introduce cable-like TV services online, but there is one big difference in the Hulu scenario. Hulu is run by content guys, not by a hardware or software company.

21st Century Fox and Walt Disney Co. (NYSE: DIS) co-own Hulu along with silent partner Comcast Corp. (Nasdaq: CMCSA, CMCSK), which also owns NBCUniversal LLC . The WSJ reports that licensing agreements are in the works to bring Fox channels and Disney's broadcast and cable network content to the new Hulu service. Comcast has apparently not agreed to license NBCU content to date.

For more on video market trends, join us at the Video Summit, part of our upcoming Big Communications Event in Austin, Texas, May 24-25. Register now!

Hulu is said to be in the early stages of negotiating content deals with third-party programmers, although the company is not expected to include all of the channels typically present in a cable bundle. As a skinny bundle of sorts, the planned Hulu product sounds most similar to online offerings from CBS Corp. (NYSE: CBS) and Home Box Office Inc. (HBO) – a distribution service built around the distributors' own content. However, the Hulu service would reportedly be priced at a much higher rate of about $40 per month. CBS All Access and HBO Now are priced at $6 and $15 per month, respectively. (See CBS Takes OTT Plunge and HBO Now Goes With Apple for Now.)

Other online video services with linear TV content include Dish Network LLC (Nasdaq: DISH)'s Sling TV, priced at $20 per month, and Sony Corp. (NYSE: SNE)'s PlayStation Vue, starting at $30 per month. (See Sling TV Launches Beta Multi-Stream Service and Sony Takes OTT Service National.)

Facebook and Twitter Inc. have also expressed interest in licensing and distributing live TV content. Twitter has partnered with the National Football League to stream Thursday Night Football games, beginning this fall. (See Facebook, Twitter Join TV Hopefuls – Report and Twitter Fire Hose Now a Video Tsunami.)

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

alanbreznick 5/3/2016 | 11:32:45 AM
Better Odds for Hulu? i agree that Hulu has a better shot of making this happen than Microsofto r Apple because it has lots of ocntent. But how many video bundles can the market absorb? And might the pricing be too high?  
Sign In