April 2, 2014
Hulu Plus Inks Deal With NBC Universal For Streaming Rights
Peter Suciu for redOrbit.com - Your Universe OnlineThe Wall Street Journal reported that this is the latest in a series of deals that the streaming video service has made as it takes on arch-rivals Netflix Inc. and Amazon.com Inc.
The agreement, which is to be made official on Wednesday, will provide Hulu Plus subscribers with past seasons of NBCU-produced shows.
“Well, get cozy and get ready to watch your favorite NBCUniversal shows now exclusive to Hulu Plus, including Universal Television’s ‘The Mindy Project’ and Golden Globe-winning comedy ‘Brooklyn Nine-Nine’ exclusively on SVOD,” Mike Hopkins, Hulu CEO, posted on the company’s official blog on Tuesday. “In the coming weeks, additional NBCUniversal favorites including Bravo Media’s ‘The Real Housewives’ franchise, ‘Top Chef,’ ‘Top Chef Masters,’ ‘The Millionaire Matchmaker’ and ‘Flipping Out,’ as well as E!’s ‘Keeping Up With the Kardashians’ will also be available exclusively on SVOD to Hulu Plus subscribers. Full prior seasons of fan favorite comedy ‘Parks and Recreation’ will be available on Hulu Plus non-exclusively.”
This will be offered to those viewers who pay the $7.99 per month subscription for the service, and clearly is meant to build on what has been Hulu’s biggest strength – namely that it offers the current season of hit TV shows. This is in contrast to Netflix and Amazon, which has been more focused on past seasons of shows – a strategy that has made both services destinations for viewers looking to binge and catch up on those shows.
“The value of the current season to us has a limit,” Hopkins, a former 21st Century Fox executive who took over as Hulu's chief executive last fall, told the Wall Street Journal on Tuesday. “We have to do other things.”
This apparently includes adding that past season content, and as noted by the Journal is something that “pay-TV providers typically don't have in their on-demand offerings—and investing in original programming," he said.
The NBCU deal will make more than 900 new episodes available on Hulu Plus, with the Fox comedies available as soon as Wednesday whilst those from E! and Bravo will be added in the coming weeks.
This deal with NBCU follows a deal inked with CBS Corp. in February that made prior seasons of “Elementary” available on Hulu Plus; and with Walt Disney Co.’s ABC for the rights of the musical soap “Nashville.” Select episodes of both series will still be available on Hulu’s free service.
Hulu, which is jointly owned by Disney and 21st Century Fox, generated a reported $1 billion in revenue last year. While NBCU’s parent Comcast also owns a stake in Hulu, the Journal noted that for “regulatory reasons” it is barred from making any management decisions. At present Hulu has more than five million Hulu Plus subscribers. The Journal also reported that the company received an injection of $750 million in capital from its owners last year from its owners.
This investment came after its owners stopped the sale of the streaming service last June. Instead the partners announced that the best path forward for Hulu was to be a “meaningful recapitalization” that was meant to accelerate growth under its current ownership structure.
However, as the Journal also noted, “Challenging larger rivals won't be easy for Hulu, which has far fewer subscribers and fewer resources.”
Netflix currently has 32 million paid subscribers in the United States and reports suggest it will spend about $3 billion on content this year, while Amazon has said it has “tens of millions” of subscribers to its own Amazon Prime service, which includes access to streaming videos.