Are You Willing to Pay for Hulu?

     January 21, 2010


Hulu, the popular no-charge online TV and movie service offered by a number of network TV stations and other media giants, will be looking into a pay model that could cost you to view some of the older content on the site in an effort to draw revenue. This comes as no surprise, but how much has always been a hot topic of contention.

The LA Times is reporting that Hulu will strongly consider a model of $4.99 per month for older content, while maintaining the ability to stream the five most recent episodes of a current TV show. The article points out that Hulu aims to have at least 20 TV series in full to make the price point viable for an audience that has been fed a steady diet of free. Uncited sources in the article claim that we could see a pricing model within six months.

For more on what TV shows Hulu is thinking of charging for and why The New York Times and Pandora are joining the pay model, hit the jump.

new_york_times_building_01.jpgAccording to the article, Hulu will plan to charge for 30 Rock, Modern Family, and House. However, they also plan to add older shows to their lineup if the pricing model moves forward. Obviously these shows wouldn’t have a “most recent” episodes list, so perhaps they will give the first five or a user-controlled selection of five episodes from the older series.  There was no word on whether the company is looking to charge for some of their movies, but I wouldn’t put it outside the realm of possibility if they increase the amount of films they offer.

In related pay-model news, on Wednesday, The New York Times announced they would be moving to a pay model next year that would allow users to view a certain amount of articles before having to pay. This is termed a “metered” approach, and would likely look similar to the model Variety is currently using.

“The New York Times is very smart,” said Mike Vorhaus, president of media consulting firm Magid Advisors. “The person who comes once or twice for a really big news article is never going to become a payer, so let’s not try to force them. Let’s not try to make a sheep into a cow. The most frequent viewers should be paying the most.”

Joining in on the pay model is the popular music service Pandora, who recently began charging users 99 cents if they listened to more than 40 hours of music in a month.

What does this mean for you and me? Well, we are starting to have the cold, hard reality hit us in the face. Free is nice, but these companies want to earn money and you can’t stay in business too long without an influx of money, often outside of advertising revenue.

“The economic reality of any type of content is that you need people to put some money into the tip jar,” said Tim Westergren, founder of Boxee.

Of course, how much is always the biggest part of the equation that the companies have to balance. Not to mention, for what? Giving the user an equal return on their investment is key as well.  Additionally, with the rise of Internet connected TVs, video game consoles, Blu-ray players, and devices like Boxee, which recently unveiled a way to charge for content on-demand, the computer is no longer the sole medium for viewing online content. We are at a turning point where people are canceling their cable subscriptions and reaping the benefits of Internet connected devices through their television.

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