According to the Wall Street Journal, Fox Broadcasting owner News Corp. and ABC owner Disney are contemplating pulling some free content from Hulu. The problem is that the networks providing content for Hulu are not satisfied with the current business model. They are not sure how much of their content they should offer for free on Hulu and are worried that these web versions are “eating into their traditional business.”
To add to the problem, Netflix is doing extremely well with online streaming and could be a serious problem for Hulu. Some networks are even contemplating moving their content from Hulu to Netflix, which is a subscription-only service and can guarantee some type of revenue flow. Netflix would welcome the new content as they are trying to get rid of DVD’s and focusing more on streaming. In an effort to mix things up, it looks like Hulu may try to be more like cable TV:
And in what would be a major shift in direction, Hulu management has discussed recasting Hulu as an online cable operator that would use the Web to send live TV channels and video-on-demand content to subscribers, say people familiar with the talks. The new service, which is still under discussion, would mimic the bundles of channels now sold by cable and satellite operators, the people said.
Of course, this is mostly rumor, but Hulu definitely needs to make some changes in order to stay competitive. Viewing habits are changing. People are watching more shows online. Things are changing fast and Hulu needs to make moves.