Hulu and Netflix Want to Bundle Their Subscription Services With Cable Providers

Hulu is reportedly looking for ways to make their subscription service, Hulu Plus, available through cable TV providers, according to The Wall Street Journal.

Hulu is reportedly looking for ways to make their subscription service, Hulu Plus, available through cable TV providers, according to The Wall Street Journal. This would allow them to compete more directly with Netflix, which is already in talks with Comcast to make their shows and movies available through set-top boxes.Currently, customers who want streaming video on-demand (SVOD) on their TV sets either need Internet-connected TVs or must switch to a different TV-input to get a signal from connected devices such as game consoles or Web-TV boxes, like Roku.Hulu is reportedly in talks with Comcast,  Time Warner Cable, AT&T and Verizon. Time Warner, AT&T and Verizon have already passed on Netflix’s offer to combine their services, leaving the largest SVOD provider to work out a deal with Comcast (arguably the cable provider with the worst customer service team ever — from my own experience, I doubt the Comcast customer care team could answer any customer’s question about Internet streaming).However, the Netflix-Comcast talks are supposedly being held up because Netflix is insisting the cable providers use technology that would allow Netflix to connect its special servers directly into the broadband providers’ networks. This technology would improve the streaming video quality.Curiously, however, reports are surfacing that Comcast is looking to sell digital downloads of movies, which would be a bit anachronistic, since streaming  (i.e., renting) is often preferred by consumers than downloads (i.e., ownership).If these deals go through, however, it would change the game for subscription video content. As I’ve said many times before, consumers will pay for convenience, such as being able to stream TV shows and movies for their whole family on a large screen and on-demand.But the big questions is, will their price points change? The current appeal of SVOD right now is the relatively low price points (both are $7.99 a month) compared to bundled cable bills. Consumers might not mind paying a little extra to get Hulu or Netflix access on their TVs if they already have cable, but it will be hard to transition cord cutters to the bundled package.If Hulu and Netflix are smart, they would look to be the provider, not the service, of Internet-enabled TVs. But I suspect these current deals are giving them the capital to grow in that direction.

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