Making yet another adjustment to its business model, Hulu is dropping its monthly subscription price from $7.99 to $5.99 as Hulu tries to figure out how to compete with Netflix and other over-the-top TV subscription services, reports Money. The lower price applies to new subscribers only, and is only available for the first year or a user’s subscription. After year 1, the monthly price jumps back up to $7.99. This subscription plan includes limited commercials. This is just the latest in a series of changes for Hulu.

Commercial-free viewing is still available to subscribers for $11.99 a month. Due to streaming rights, some programs are not available under the commercial-free viewing plan, says PC Magazine. Those shows include Grey’s Anatomy, Once Upon A Time, Marvel’s Agents of S.H.I.E.L.D., Scandal, New Girl, Grimm and How to Get Away with Murder. Each of those programs has a commercial before and after each episode.

Hulu reports the following numbers for its streaming network:

• 12 million subscribers
• Over 400 content partners
• 700 million hours of streamed content
• More than 2,000 advertising partners
• #1 in engagement among top ad-supported online video sites (Netflix is not supported by ads.)

By comparison, at the end of the second quarter of 2016, Netflix reported 83 million members, and it estimated 2.3 million new members during the third quarter of the year. CBS All Access, priced at $5.99 a month, had about 1 million subscribers at the end of the second quarter. Showtime, owned by CBS, also reported 1 million subscribers for that time period.

Hulu is trying to get its share of the streaming video marketplace, which seems to add new players every month. Hulu competes with broad-based streaming video services like Netflix, CBS All Access, YouTube, Amazon Prime and Sling TV as well as niche services like WWE Network, REVRY, Seeso and TuYo.

Insider Take:

From a viewer standpoint, Hulu’s constant changes can be perceived as annoying, particularly for current subscribers who will not get to take advantage of the price drop. From a subscription company viewpoint, however, we think Hulu’s pricing shift is a smart one.

We’re guessing that, after discontinuing its free ad-supported service this summer, Hulu did not get as many conversions from free to paid users as it had hoped, so it is running a promotion to bring some of those viewers back. Hulu is willing to sacrifice $2 a month for the first year to attract and retain viewers. Looking at the broad-based streaming TV services category, CBS All Access is the only other service priced at $5.99, so Hulu has a competitive advantage for viewers who base their decision on price.

Another aspect of the change we like is that Hulu did this just two months into the shift in its business model. It tested a change, reviewed the results and adapted to the numbers. That’s a wise play for any subscription company. Test, tweak, repeat.