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Hulu will be cutting users off from much of its content in May. To gain access to older content, they will now have to pay a subscription fee. More ads are coming soon, as well.
Customers will have to pony up $9.95 in order to see a comprehensive selection of the season's episodes; more ads coming, too

Since March 2008, Hulu has been offering guests a wealth of free TV episodes from parent companies NBC Universal (General Electric), Fox Entertainment Group (News Corp) and ABC Inc. (The Walt Disney Company).  Well, they're not totally free -- you have to watch the occasional ad.  Still, the premise has been a hit, rocketing Hulu to short list of elite websites that includes the likes of YouTube and Facebook.  

The last few months of 2009 were a happy one for Hulu -- it enjoyed its first profitable quarter.  Despite that success, early this year the reoccurring rumor popped up that Hulu was going to start charging subscriptions for at least some of its content.

The only difference is that this time the rumor appears to be true.  Starting in May, Hulu will reportedly air a $9.95 monthly subscription service.  It will continue to offer a bit of free content -- the five most recent episodes of popular shows like Fox's "Glee," "ABC's "Lost" or NBC's "Saturday Night Live".

The crucial difference will be that the current vast library of past episodes and content will be closed off from non-subscribers, accessible only if you pay the monthly fee.

That may be acceptable, considering the average Hulu episode has less commercials than the average TV episode.  But that's the other piece of bad news -- Hulu is reportedly considering upping its number of commercials in the near future as well.

Ultimately the subscription fee isn't horribly high.  However, it will certainly turn some away from the internet's second most popular video site.  And it will make it harder for users to share content, a major source of Hulu's popularity.  

The networks are intent on increasing their profits and bringing the Hulu revenue more in line with the cable offerings.  However, if they load the episodes with commercials, on top of the planned subscription fee, they just might find that internet users aren't quite as interested.

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Step in the right direction
By monitorjbl on 4/22/2010 11:42:54 AM , Rating: 3
This is a nice sort of compromise; the free users won't really notice anything because Hulu generally only shows 5 episodes from the current season for most popular shows, and the paid service lets you get access to a bigger library. I am one of those people that will gladly sit through commercials if I can have an on-demand service with shows I actually care about on it and if I had the money to do so I would pay for the service (I'm a college student and therefore poor).

I'm really glad that the studios are finally coming to terms with the realities of the internet because here's the thing: I'm one of those people that will get the content he wants on his terms, no matter what. If I want to see something and the only way I can is by waiting for it to come on TV or buying some stupidly overpriced DVD box set, I have no qualms about downloading it or finding it online somewhere for free. I'm not generally an advocate of piracy, I tend to buy music off iTunes and I will always check legitimate channels before I go off and download something, but if the terms presented to me are not favorable or fair, I'll get it my own way. I realize this is a contradictory statement, but it's the way I and a lot of computer-savvy people are.

It comes down to this: with the internet, it's just too easy to get things for free, and asking some huge price for it is just being unreasonable. The economics of the internet sort of transform basic supply and demand into something more complex with an additional "this stuff is easily obtainable at no cost if the user is willing" factor thrown in there. I don't claim to know how it should all work, but this is a good first step; give the users that don't want to pay access to new content and give the ones that are willing to pay access to the entire library on demand. Anyway, hats off to Hulu (and by association the major networks) for figuring this out after so long.

"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings

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