Hulu has announced it is dropping its ad-supported free streaming tier, moving to a subscription-only service model. Not all is lost for the service’s free fans though, as much of the ad-supported content will move over to Yahoo’s new “Yahoo View” streaming service which will “feature” Hulu, and will allow viewers to watch the five most recent episodes of broadcast shows for free.
Hulu is co-owned by Walt Disney, 21st Century Fox, Comcast, and as of last week, Time Warner. These companies want to use Hulu as a hedge against Netflix, where they sell their content and compete for time and consumer dollars. Making Hulu subscription-only allows them to better position it as a premium service that can house original content. By shifting ad-supported streaming over to Yahoo, Hulu’s ownership reduces friction with its own TV advertisers and positions Verizon, which just acquired Yahoo, as a source of substantial future revenue.
“For the past couple years, we’ve been focused on building a subscription service that provides the deepest, most personalized content experience possible to our viewers,” Hulu senior VP and head of experience Ben Smith said in a statement. “As we have continued to enhance that offering with new originals, exclusive acquisitions, and movies, the free service became very limited and no longer aligned with the Hulu experience or content strategy.”
Hulu currently offers two subscription plans: $7.99 per month with commercials, and $11.99 per month without any ads. Hulu has long walked a tightrope, as while it is owned by a number of players who are big in the world of network television, it also offers an attractive option to the cord-cutting generation of viewers. By going pay-for-play, the service can cater to the cord cutters that make up a good part of its paying subscribers.
Meanwhile, Yahoo gains new content to bring eyes to the lagging online portal, which is in the process of being acquired by Verizon.
Jess Lee, Vice President of Yahoo Lifestyles Product:
“So, I’m incredibly excited today to announce the launch of Yahoo View, a brand new community TV-watching site. We are partnering with Hulu to offer thousands of free full-length episodes of premium TV shows, anime and Korean drama, as well as movies and TV clips. We’ve got everything from “Scandal” to “Empire” to “One Punch Man” to “Sungkyunkwan Scandal.” You can also go beyond the episode with behind-the-scenes extras, recaps, and the best GIFs, photos and edits from the Tumblr fandom community.”
Viewers who make the switch to Yahoo View will be inconvenienced a bit, at least in the short term, as the service is currently available only via desktop browsers, although a mobile website, and mobile apps are promised to be on the way.