Hulu said it is now limiting individual commercial breaks to 90 seconds. Commercial breaks had been 180 to 240 seconds long. Earlier this year, Hulu decided to add “pause” breaks, which appear as a still, display-like translucent ad after a few seconds, following a user's video pause.
Media buyers have long focused on how to keep viewers around on any media platform. Seems research has shown that quick moving and fast-changing channel media consumers might be ramping up their entropy.
Hulu now makes around $1.5 billion in advertising a year. Does this mean things are getting harder for the advertising part of its business?
Earlier this year, Hulu dropped the price of its limited commercials plan to just $5.99 (from $7.99), while keeping their ad-free service at $11.99 a month. So with the lower price, and reduced ad load -- the company will be looking for ways to make up for higher revenues.
Does it suggest higher CPMs/unit pricing? Right now it has been getting lower, down around $20 cost per thousand impressions, according to reports, given rising inventory.
Is video competition a factor? Yes, but not from the usual cast of characters that offer premium video — higher TV network quality program series. It could be other video stuff.
YouTube makes $15 billion in advertising revenue from for its digital video content, around 10 times what Hulu earns in a given year.
Many would say high-minded, brand safety-minded advertisers that buy into Hulu aren’t the typical bread-and-butter YouTube video advertisers. But that has been changing -- albeit, slowly.
All this is occurring while Hulu plays the other side of the fence -- its subscription video on demand service, which competes directly with Netflix and Amazon, among others.
What about Hulu viewing? We don’t have any data, which might give us a clue.
Know this: With more digital viewing efforts for traditional TV network groups around OTT and other digital video platforms, Hulu -- and its three legacy TV owners, Walt Disney, Comcast, and Time Warner -- will see more changes.