Hulu Sees Audience Growth | Adweek Hulu Sees Audience Growth | Adweek
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Hulu Sees Audience Growth

Executives credit new content deals with year-end bump in audience

Hulu CEO Jason Kilar | Photo: Toshifumi Kitamura/AFP/Getty Images

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After one of the most tumultuous years in the site’s history, Hulu has happened upon some good news. According to a report by online marketing research firm comScore, the video streaming platform saw an audience gain of 23 percent year over year for the month of November, to 34.5 million unique viewers.

The bump coincided with a number of new content deals that kicked in during November, including with The CW, Sony Pictures Television, and Spanish-language broadcaster Univision.

“One of the major things we’re doing is that we continue to grow our content offering,” J.P. Colaco, Hulu’s svp of advertising, told Adweek. “We started with two content partners, and now we have over 300. We’ve been very aggressive about getting content that would resonate with our audience.” Colaco said this strategy, combined with the expansion of the site's Hulu Plus premium offerings which enables paying subscribers to access content on mobile devices as well as their computers, explains the site’s audience growth (though video views from mobile devices were not counted in comScore’s measurements).

According to Colaco, the addition of new programming last month also helps explain why the increase in unique viewers year over year was so much higher in November than it was last month (Hulu’s audience increased just 6 percent, to 31.9 million year over year for October, according to comScore).

The uptick in audience comes at the tail end of a turbulent year. Last January, The Wall Street Journal reported that some of Hulu’s network owners (the site is backed by NBCUniversal, News Corp., Disney, and private equity firm Providence Equity Partners) were considering pulling content from the platform because of a shared fear that Hulu was eating away at their television businesses. The content ultimately stayed, but this past June reports began circulating that Hulu was on the block and it had enlisted Morgan Stanley and Guggenheim Partners (Guggenheim is an investor in the company that owns Adweek) to help with the sale. Months of rumor and speculation ensued regarding who the potential buyer might be, but in mid-October, sales efforts abruptly ended with Hulu remaining in the hands of its original owners.

The recent increase in audience, said Barclays Capital analyst Anthony DiClemente, indicates that “the speculation about a possible change in ownership has not affected the product and isn’t something the consumer is intimately aware of when they use it.”

What’s more, DiClemente noted that in the current online video marketplace, Hulu is well-positioned to attract ad dollars. “The amount of time Americans spend online is doubling. But the amount of ad dollars online is not doubling. It’s growing at around 15 percent a year,” he said, meaning that in an environment where advertisers are being selective about how much they spend online, Hulu (which derives most of its content from television) “is in a position to absorb the dollars being spent. There aren’t that many places with really professional content.”

Ultimately, it is continued access to this professional content that will be the deciding factor in whether Hulu can continue its audience growth, a point that both Barclays’ DiClemente and Hulu’s Colaco acknowledge tacitly. Though Hulu executives declined to comment on their current licensing negotiations with content partners, Colaco said, “Content is one of the major drivers of [Hulu’s success].”