• by Wayne Friedman , June 23, 2017

Hulu’s new live package of linear TV networks could add major TV advertising and subscription revenues to its coffers.

An analysis of MoffettNathanson Research says the Hulu with Live TV service, which started up last month, could initially generate annual advertising revenue of $71.1 million and $568.3 million in subscriber fees. That's after getting 1.18 million subscribers, 1% of the total U.S. TV homes at 118 million.

At the high end -- 4% of U.S. TV homes, 4.7 million subscribers -- the media research analyst group says Hulu Live could pull in $474.3 million a year in ad revenue and $2.27 billion in annual subscriber revenue.

MoffettNathanson says advertising avails for Hulu will come -- as with its longtime, ad-supported, on-demand service -- from its media partners: NBC, ABC, Fox and Time Warner. Those new deals would also include addressable targeted audience advertising.

For its new Hulu Live service, MoffettNathanson uses a range of calculating advertising at $5.89 to $9.82 per subscriber per month. It also assumes an average consumer monthly price for Hulu Live at $40 -- the current price of the package.

For its non-linear, on-demand programming service, Hulu is estimated to have generated $8 to $9 per subscriber per month, factoring in lower advertising loads and healthy CPM priced ad units.

By way of comparison, estimates from Hulu’s existing businesses indicate the company pulls in just over $900 million annually in advertising.

Last year, Alexia Quadrani, media analyst of J.P. Morgan, estimated that Hulu revenues -- from its legacy ad-supported on-demand service, Hulu, and its non-advertising service Hulu Plus -- would total $2.4 billion in 2017. (That counts 61% from subscribers revenues/39% from advertising).