Hulu considers going ad-free, for a hefty price

Steven Loeb · July 17, 2015 · Short URL:

After Netflix's giant week, Hulu seems to be reconsidering its place in the ecosystem

I recently got around to watching the sixth season of Community, which had moved from NBC to Yahoo, and there was one thing that bothered me (besides the quaity of the show, which was pretty iffy): the ads. Not sitting through them, necessarily, but the fact that they were the same three or four ads, played over and over. After a couple of episodes I could recite them by heart.

Yes those ads were annoying, but would I pay to not sit through them? Probably not.

Hulu thinks you might, though, and is getting ready to offer its subscribers the option to have an ad-free service, for some additional money, of course, the Wall Street Journal reported on Friday.

Of the big three streaming services, along with Netflix and Amazon, Hulu is the only one with an ad supported model. Even for people who pay, they are only paying for additional content. They still sit through advertisements.

Code named "NOAH" or "No Ads Hulu," the ad-free service would cost between $12 to $14 a month, as compared to the $7.99 per month that subscribers are paying now. 

That price is awfully high. Not only is it nearly double the price for a minor upgrade, its also more money than the highest Netflix plan, which costs $11.99 a month for four screens, and it costs nearly as much as a premium service like HBO Now, which is priced at $15.

Frankly, I wouldn't expect many people to go for this, not at that price anyway, but this is still an interesting move by Hulu, and one that shows that it is thinking about how it stacks up against other similar services, one of which just had what can only be described as its best week ever.

Netflix released its second quarter earnings earlier this week, and it saw revenue increase to $1.64 billion from $1.34 billion a year ago, and it added 3.3 million new subscribers. That has sent the company's stock soaring to record highs. Before its earnings on Wednesday it was trading at $98.13 a share; it is currently trading at $115.49 a share.

While Hulu had around nine million subscribers, Netflix has 65 million; while Hulu is on track to bring in about $1.5 billion to $1.7 billion in revenue this year, Netflix's revenue in 2014 totaled $5.5 billion.

That kind of success has to be weighing on Hulu, especially given that of all three services, Hulu is also the one has never found that big zeitgeisty hit, like Orange is the New Black for Netflix, or Transparent for Amazon. Nor has it found the award winning show like House of Cards and, again, Transparent.

Maybe the thing to do would be to shake things up a bit. Getting away from trying to replicate television, with its ad model, might be a good start for Hulu to finally find its groove.

VatorNews has reached out to Hulu for confirmation of this report. We will update this story if we learn more. 

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