Hulu touted a 30 percent climb in subscribers in the last year ahead of Wednesday’s star-studded presentation unveiling its programming slate to marketers.
The streaming service now has more than 12 million customers, but there’s a downside: Memberships were climbing at a 50 percent rate a year earlier. And, by comparison, streaming giant Netflix just surpassed 81 million.
The slowing comes even though Hulu has spent much of the last year tweaking the ways people can subscribe and what they get when they do. It abandoned its “Hulu Plus” brand name last year and introduced a new, pricier $11.99 option that strips out all commercials, compared with its ongoing $7.99/month deal that includes some ads but not as many as free viewers see.
It also began bundling Hulu subscriptions with memberships with other streaming services. Last year, it began offering the option of subscribing to Hulu and Showtime’s streaming service both for for about $17 a month, less than it would cost to get both separately.
And Hulu is in talks with programmers about adding live TV channels like ESPN and Fox to its options, the first time the site would be breaking from its identity as a place for on-demand streaming of shows the day after they broadcast on regular TV.
Rivals like Netflix and Amazon price their subscription services cheaper than Hulu and never have commercials, though they also never provide people the chance to watch all their programming free. But Hulu is owned by the parents of three of the country’s big broadcasters, Comcast, Disney and 21st Century Fox, which all have a vested interest in keeping people accustomed to watching ads. Until last summer, Hulu had no ad-free option.
But growing membership is harder to keep up at the same clip for all streaming services, as more and more companies launch their own online platforms. As consumers shift more of their entertainment diet to online alternatives versus regular television, fear about missing out on the next big video audience has spurred programmers like HBO, CBS, Showtime and others to launch their own personal versions of Netflix. Meanwhile, digital-first new media companies like Fullscreen and AwesomenessTV are creating subscription options for their young audiences, too.
Last month, researcher Parks Associates said these news services are creating more dogged competition for shares of consumers’ wallet, with new members sometimes testing out a service during a free trial and then cancelling before or soon after it ends.