Hulu Announces Four More Original Series, Bringing Total Lineup To Seven
Hulu has been having a busy week. On Tuesday, the company announced a new deal for advertisers, which now charges them only for ad completions, and today at Hulu's upfronts, the company announced the arrival of even more original shows.
Context & Ripple Effects
The upfront announcement extends a pivot Hulu has been signaling for over a year: the January 2011 report that Hulu was plotting a move into scripted originals has now materialized into a seven-show slate. It lands while the company's owners remain in an unresolved spot — reports circulating since October 2011, still unconfirmed, said Disney and Comcast were reconsidering a sale after bids came in below hopes.
The week's two moves work as a pair: exclusive originals differentiate the service, while the confirmed advertiser deal that charges only for completed ad views de-risks the buy. That the story traveled to eight outlets in a day — Bloomberg, AdAge, the Guardian, CNET, The Verge among them — reflects how much weight ad buyers put on the pricing change, not just the programming.
First-order effects
- Advertisers buying Hulu inventory no longer carry completion risk — Hulu absorbs the cost of every skipped or abandoned ad across its lineup, directly tying its ad revenue to whether viewers actually watch.
- With seven originals it controls outright, Hulu gains exclusive programming beyond the licensed network catalog whose renewal terms were still being negotiated with its network owners as recently as May 2011.
Second-order effects
- Rivals selling pre-roll against licensed libraries — most visibly Netflix, whose apps Nielsen data showed dominating iPad viewing — face a competitor bundling differentiation through originals with a guaranteed-delivery ad pitch.
- Networks licensing shows to Hulu now supply a partner that commissions its own exclusives, a dynamic that will pressure licensing economics whenever those distribution agreements come up for renewal.
Third-order effects
- If completed-view pricing spreads across online video, ad pricing migrates from impressions toward verified attention, advantaging platforms that control both the player and the measurement.
- Aggregation-only streaming businesses look structurally exposed: Hulu's path from licensed-catalog distributor to owner of originals suggests distributors need proprietary content to defend margin once licensing partners become competitors.
The trend: Streaming distributors are converting themselves from licensed-content aggregators into differentiated networks by pairing owned originals with performance-guaranteed advertising.