Hulu has kept raising its game in the last year with an ever-expanding array of original series, acquired series and movies. But now the streaming service is making an unexpected move in its competition with fellow SVOD companies like Netflix and Amazon: Hulu is developing its own skinny bundle of cable and network channels, which it will sell directly to consumers.
According to a Wall Street Journal report, Hulu is readying an over-the-top subscription service, featuring a mix of broadcast and cable channels.
Hulu had no comment on the WSJ story. A source said the news would be addressed at its Wednesday NewFronts presentation.
This could be a huge boon for Hulu, as the new service would enable its ad sales team to provide the same kind of targeted advertising opportunities that it current offers on its monthly subscription service, according to a source.
Among the networks reportedly included in Hulu's new bundle are channels from Hulu's co-owners Disney (ABC, ESPN and Disney Channel) and 21st Century Fox (Fox, Fox News, FX and Fox's sports channels). Hulu's third owner, Comcast, hasn't yet agreed to add its NBCUniversal networks to the service.
Hulu is targeting a 2017 launch, and the streaming service is expected to cost around $40 per month, according to the report. While it would be available to everyone, Hulu is likely to initially target its current 9 million-plus subscribers.
Hulu would become the latest company to offer a "skinny bundle" of channels to subscribers, in an effort to lure "cord cutters" and "cord nevers" who don't subscribe to cable. Sling TV also offers an over-the-top service, including channels like ESPN, AMC, TBS, Freeform and Lifetime, while cable companies like Comcast and Verizon also offer slimmed-down packages to subscribers.
Hulu teamed with Showtime last summer to offer the premium cable company's new standalone service to Hulu subscribers, at a discount. That was the first time the company had offered a dedicated channel outside of its own programming.
Last year, the company rolled out an ad-free subscription tier, which followed months of planning and speculation. Hulu is taking a similar, deliberate approach to this new over-the-top service, according to a source.