Hulu's CEO Talks Programming, Brand Safety, Ad Formats And Choice
- by Karlene Lukovitz @KLmarketdaily, June 19, 2019
Now that the Walt Disney Company is in full operational control of Hulu as its majority owner, Hulu subscribers can look forward to an expanded roster of original programming.
With access to Disney’s formidable content creation capabilities, Hulu is “going to be able to invest more, and invest more upstream, and find the best stories and the best creators to make shows for the company,” Hulu CEO Randy Freer said in an interview with Julia Boorstin on CNBC’s “Squawk Box” yesterday, from the Cannes Lions festival, hosted on CNBC.com.Under the deal inked in March, Comcast can sell its 33% stake in Hulu to Disney in 2024 for no less than $27.5 billion, and Disney will pay Comcast for Hulu content for five years.
Freer also said that the new terms of the relationship among Disney, NBCUniversal and Hulu have brought "clarity of voice" and "clarity of objective" that is enabling the companies to solidify their strategic plan and "what the next couple of years will look like."
Hulu’s popular original programs include “The Handmaid’s Tale” and “Catch 22.”
The streaming VOD platform’s ad-supported options include its $5.99-per-month plan and a $12.99-per-month bundled package with Spotify Premium.
Its premium, ad-free plan currently
costs $11.99 per month.
Disney has also discussed the possibility of bundling Hulu and ESPN+ with the Disney+ streaming service set to launch in
November.
During the interview, Freer said that, while the specifics about such a bundle aren't yet clear, he views it as an opportunity to "have the best of general entertainment direct to the consumer.”
With Disney+ offering “the best for kids, the best for movies from Pixar and others,” and ESPN+ in addition to Hulu’s own live product, Hulu will be able to accelerate the already strong growth of its subscriber base, he said.
Asked whether the mounting pressure on Facebook and Google over privacy concerns
will benefit Hulu’s advertising business, Freer said that the most important factor for brands is “to know that they are in a safe environment.”
That
“comes down to a choice — and as long as we as businesses give consumers a choice on what they want to watch, where they want to watch it, and how the ad scenario is, I think we’ll
be in great shape,” he said.
Brands, he added, also need to be given the choice as to the type of environments in which they want to advertise.
“That’s one of the things that’s made Hulu incredibly popular with brands today,” he asserted. Hulu not only offers a brand-safe environment,
but “huge” audiences that are “25 years younger than network television or other places,” and long engagement times, Freer declared.
After growing members by 40%, or 8 million, last year, Hulu has about 28 million U.S. subscribers — including 26.8 million paid subscribers (not including those on free trials). The platform has $1.5 billion in ad revenue.
Asked about competition from upcoming, ad-supported streaming services from AT&T and NBCUniversal, Freer stressed that it’s more important than ever to make sure that the ad-supported consumer experience is consumer-friendly.
“It used to be OK for Hulu to say: ‘We have half the commercial load of network television,'" he noted. “Now we actually have to find ways to reduce that [further] and ways to integrate the brands into the ads. That’s why we recently launched pause ads and a number of other ad formats -- like “Friends With Benefits,” a format we’re using with Old Navy.”
Most important of all, he maintained, is giving consumers the choice of viewing programming with or without ads.
