App Management: Why Hulu's Two-Fer Deal With Showtime Is Smart

If there is something on the online video biz could learn about cable’s bad habits--and really there’s a ton--one big lesson would be not to offer so much choice. It gets people confused.

Consolidate! Right now, the average cable customer gets something like 190 channels--that keeps going up--but they only watch about 17. That number stays about the same. And they're mad about it!

People complain that they don’t want all those channels, a remarkable thing really. No one says to McDonald’s, “Oh please, that Big Mac is just too big!” Yet, the whole skinny cable move is to pare down the noise. Please, give us less! (Also charge us less.)

So the announcement that Hulu will offer its subscribers a deal to also tack on Showtime’s soon-to-debut online service, at a discounted price, sounds right to me. It’s one less separate service to pay for. It also fits the way people view Showtime, kind of the Dave Clark Five to HBO’s Beatles.

Despite some truly excellent programming and furious PR to get itself into the Emmy statue race with that big HBO Oscar hog, Showtime still is what a former co-worker (not at MediaPost!) once called herself: Nice but unnecessary.

It would cost you $10.99 to get the Showtime stream on its own, but $2 less per month to tack it on to a Hulu $7.99 subscription.

As more people begin accessing content online by adding and paying for apps, I’m pretty sure they will do it remembering full well that in the past, they’ve been similarly burdened by that weight of stuff. They don't want to a cloud locker full of apps they never app. Millions of Americans just want less; that's a big reason they're contemplating cutting the cord. 

The original cable proposition was simpler: Right now, you have three or four channels on your TV. What if could get a lot more? That sounds great. Sounded great. The going-in proposition about the Internet is that it has everything and a lot you definitely don’t want; it’s your job to cut through the weeds.

Re/Code reported that Hulu is paying the $2 a month savings out of its own pocket, so that a month of Hulu/Showtime would be $17, rather than $19 if bought separately. That’s a bargain, and bargains work. Millions buy Amazon Prime because a subscription makes a lot of Amazon shipping costs free. (Why not a free bath towel stuffed into the set-top box?)  

It might also be that Hulu could be feeling a little vulnerable. With so many new OTT services out there, Hulu would probably like to be seen as a bargain rather than the one that viewers shove off, and with nine million subscribers, it’s a gnat compared to Netflix and Amazon.Hulu’s big push into higher-profile original productions, detailed at its NewFronts, seem 10-times better than what it’s done previously.

It doesn’t come a moment too soon.

1 comment about "App Management: Why Hulu's Two-Fer Deal With Showtime Is Smart".
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  1. larry towers from nyu, June 24, 2015 at 7:21 p.m.

    "Please, give us less! (Also charge us less.)"

    Not going to happen, especially as industry consolidation continues. A la carte always end up costing more. Consumers don't want less of everything. They want less junk.

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