The ironic thing about all these industries like music and journalism wanting to build something just like Hulu is that Hulu doesn't really want to be Hulu, anymore. The free ad-supported hub for movies and television is thinking about charging for its most popular shows, like 30 Rock, Modern Family and House ... all of which I watch. Good news for media, possibly. Bad news for me. Damn my increasingly expensive middlebrow tastes!
The Big Money's Chadwick Matlin has done a marvelous job explaining the existential crisis at Hulu, which he sums up this way: "Hulu's business model is all the rage with everybody but its owners." Recently music makers have come together to roll out Vevo, a site that plays high quality, ad-supported music videos. Journalism publishers are close to launching an online magazine "storefront" where users pay for bundled magazine deals, or something like that.
If I had to guess, I'd think the future of Hulu is going to be a combination of free ad-supported television and paid content. The transition could happen slowly. First, Hulu might build a small paywall around its most popular content to see how many users make the jump. If that works, it could turn to bundles. In other words, if you buy the ABC package you might pay $5 a month to watch every episode from every ABC show without ads. This would make Hulu work a lot like TV's answer to Netflix, which Chad reports announced 42 percent of its subscribers are streaming content digitally.
But this remains the central problem: If you want people to pay for
journalism, you can't give it away from free. Magazines still give away
most of their content online, so why would I ever want to visit a
swanky "storefront" to pay for what I already have? Similarly, in order
to make people pay to watch TV online, you have to stop giving it away
for free on NBC.com, ABC.com and so forth. People don't like spending
money, and they're very good at finding loopholes around paid content
(...ask the music industry).
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