In a blog post made shortly after Hulu announced it had inked a new deal with Viacom, Hulu's CEO Jason Kilar noted that the Hulu Plus subscription service, which currently costs $7.99 a month, has gotten off to a fast start and that the company is predicting their "subscriber count will pass 1 million this year, to our knowledge the fastest start of any online video subscription service. In the fall, we expect Hulu Plus as a business will have a revenue run rate north of $200 million."
Overall, Kilar predicted that Hulu's revenues would approach "half a billion in total revenues (advertising and subscription combined) in 2011, up from $263 million in 2010, which was up from $108 million in 2009."
In the post, Kilar also offered an extended commentary on the future of TV and defended the company's ad load, which is lighter than linear TV.
"Traditional TV has too many ads," he argued. "Users have demonstrated that they will go to great lengths to avoid the advertising load that traditional TV places upon them. Setting aside sports and other live event programming, consumers are increasingly moving to on-demand viewing, in part because of the lighter ad load (achieved via ad-skipping DVRs, traditional video on demand systems, and/or online viewing)."
A better approach would be would be to focus on providing more targeted ads and charging a premium for those, Kilar contended. Hulu had already made much progress in this direction, increasing its revenue per half hour show by 81% since 2007 to levels that now
Kilar also noted that "consumers want TV to be more convenient for them," with access to more on demand content on more devices" and that social media is playing an increasingly important role in marketing TV programming. "This is nothing short of a game-changer for content creators, owners, and distributors," he wrote.
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