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Q2

July 6th, 2011 by Jason Kilar CEO

We recently closed a big second quarter for Hulu. In the spirit of our Q1 blog post, we’d like to share results made possible by our recent innovations combined with a steady focus on our customers (users, advertisers, and the content community).

- The slope of Hulu Plus’s subscriber ramp is higher than we previously forecasted. We just closed our biggest month in Hulu Plus paid subscriber net additions by a healthy margin; we added more paying subscribers in June than we did in April and May combined. The below is our month-end Hulu Plus paying subscriber numbers since we exited our private beta period in November 2010. In our first 7.5 months, we are fast approaching the 1 million paying subscriber milestone (we already have over a million when including those in a one-week free trial period). We anticipate exceeding 1 million paying subscribers before the end of this summer; previously we had forecasted crossing that threshold around the end of this year. We are extremely encouraged by the ramp of this business:

- We have always believed that our path towards creating a special company lay in our ability to delight our customers. The key to delighting content owners rests in the economics, and Hulu Plus is already revealing our ability to compensate content owners at the high end of the market for a given body of content. Today, we proudly and profitably pay the content community approximately $8 per subscriber per month for the content offering you see today on Hulu Plus. A portion of the $8 payment to the content community comes from our $7.99 subscription fee; the balance comes from the revenue we generate through advertising. As Hulu Plus increases in scale and scope, we believe significantly more dollars in aggregate will move to the content community than has historically been the case in the industry. These economics are made possible by our ability to thrive on low margins and the unusually effective Hulu advertising service we’ve built and will continue to innovate. A very positive trend for the content community.

- We’ve continued our quest to make Hulu Plus available on every internet connected device. In the past 90 days, we have made Hulu Plus available on Xbox 360 and Kinect, select Android smart phones, TiVo Premiere DVRs, and select Samsung Blu-ray players. Collectively, this means an additional 25 million devices are capable of accessing the Hulu Plus service. Hulu Plus is now accessible on leading consumer electronic devices and mobile operating systems with a combined installed base of more than 100 million. Expect that number to grow aggressively over the balance of 2011.

- The content library on Hulu Plus has also grown considerably. Since the launch of Hulu Plus in November 2010, the number of total hours of content on the service has grown 67% from 9,000 to 15,000. The total number of full episodes on the service has grown 115% from 13,000 to 28,000. The number of TV series on the service has grown 129% from 950 to 2,180, which includes 76 series from Viacom brands like MTV, Comedy Central, and VH1. The number of clips has grown 85% from 13,500 to 25,000, and the number of movies has grown 222% from 450 to 1,450, including hundreds of Criterion Collection and Miramax titles. All 15 seasons of South Park, including the current season, were added to Hulu Plus in June, along with a rotation of episodes appearing on the free, ad-supported Hulu service. Hulu also exclusively premiered the U.K. hit Misfits on June 20th, which quickly became one of the most popular shows on the service. Through an exclusive first run, multi-year distribution deal, Hulu has introduced Misfits to a U.S audience of millions.

- In Q2, Hulu remained the leader in U.S. online video advertising with the largest market share (revenue) of a rapidly growing market. Hulu serves nearly 2x the number of video advertisements of the next largest advertising service (Source: comScore). Nielsen IAG measures the efficacy of Hulu’s video advertising service at nearly 2x that of linear video advertising services.

It’s been a big Q2. We remain on pace to approach half a billion in 2011 revenue. Thank you for making the above possible. We remain a team that believes in the value of convictions, thoughtful stubbornness, and the relentless pursuit of better ways.

Jason

Jason Kilar

CEO, Hulu

Last comment: about 7 hours ago 34 Comments
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  • [...] cutting (or never getting) “the cord” seems like a no-brainer. Just take a look at the Hulu and Netflix paid subscriber numbers. The trend seems to be pretty clear…even more so when you [...]

  • [...] cutting (or never getting) “the cord” seems like a no-brainer. Just take a look at the Hulu and Netflix paid subscriber numbers. The trend seems to be pretty clear…even more so when you [...]

  • [...] roster of TV shows and provided more episodes of shows it already carried, bringing totals to 28,000 TV episodes and 1,450 movies. Hulu Plus streaming video is priced at $7.99 per month, but access to content using mobile devices [...]

  • [...] roster of TV shows and provided more episodes of shows it already carried, bringing totals to 28,000 TV episodes and 1,450 movies. Hulu Plus streaming video is priced at $7.99 per month, but access to content using mobile devices [...]

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  • [...] retrospect, it’s easy to see when sales started softening. In July, when Kilar reported his company’s Q2 numbers, he was still offering the same $500 million revenue guidance. But in early October, when he [...]

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  • [...] lack of ad support would keep Hulu from wanting to play on the Apple device. Hulu CEO Jason Kilar wrote in a blog post earlier this year that the company pays approximately $8 per subscriber for content licensed on the [...]

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  • If there was an option to watch Hulu+ for 8$ with ads, and allow us to pay more to watch Hulu+ without ads, that would be perfect. I completely agree on that.

  • [...] Hulu plans to invest $375 million in content this year and reach revenue totals of about $500 million, according to the company’s second quarter progress report. [...]

  • [...] number of a million Hulu Plus subscribers before the end of 2011, according to the company’s second quarter progress report. Now it seems that Hulu will far exceed those numbers by [...]

  • [...] Redbox is growing sharply too, with revenue up 34% in its last quarter. Hulu Plus has shot up to 875,000 paid subscribers in just seven months, and expects to hit its first million in the near future. HBO Go has rocketed [...]

  • mark says:

    Dave, with the Roku as little as $60, why would you settle for a wii channel that at best will utilize component, rather than the Rokus HDMI, not to mention all the other Roku channels available?

  • Dave Matney says:

    “- We’ve continued our quest to make Hulu Plus available on every internet connected device.”

    Does this mean I can stop debating between a Roku and a Boxee Box and just wait for the Wii channel?

  • Angela Sherman-Blackwell says:

    JASON, hello. Do they call you Mr. Hulu?
    My name is Angela… I just read your exciting blog.. Congratulations! Rock on.
    HULU PLUS ROCKS, DUDE.
    I am an incredibly satisfied new subscriber to HULU PLUS… Haha, lucky for me (and for you…), the reason I joined HULU PLUS was somewhat on a whim.. My husband and I were doing an IMDB search on Edward James Olmos… I was then enlightened that I had somehow completely missed the existence of the 2003-2009, miniseries-turned-series, “Battlestar Galactica.” I thought it was worth a look. It was!
    (WINNER WINNER CHICKEN DINNER)
    After some “bitTorrent-ial” headaches, I thought, well, let’s check HULU. I’d had some fun dabbling around HULU in the past, delighting in the series, “HUMAN TARGET.”
    After viewing a clip/trailer of, “Battlestar,” I realized HULU was now offering HULU PLUS, allowing me the option to delve into the complete series. I chuckled, and thought, well, for $8, I’ll give it a whirl.
    To my delight, I found I could access every last second of anything and everything, “Battlestar,” (and for that matter, your incredibly vast library) for $8/month… Not to mention, this is on a month-to-month agreement, with no commitment, and HULU PLUS accepts prepaid cards to boot. I even got a month free for pinning the “H” to my windows task/toolbar.

    Also, I am no longer a cable TV subscriber, as my penchant for “viewing options” was proving to be outrageously expensive, costing my family over $3000 a year..
    I decided to “go social,” per HULU’s suggestion, and skeletally connect my HULU PLUS to my FACEBOOK. I’d had some comments I was hoping to share, regarding my complete satisfaction in viewing, “Battlestar Galactica,” on HULU PLUS… I then came across your blog, and was thrilled at the spike-y climb I viewed on your chart of new subscribers (above).
    I also thought, hmmm, I might want to look into applying for employment in some capacity, with my new favorite not-so-guilty pleasure, HULU/HULU PLUS..
    So, FYI, I’m diggin’ HULU PLUS. I’d have to say you guys right up there with SLICED BREAD on the “great-o-meter.”
    In a nutshell, Mr. Jason Kilar–YA’ DUN REAL GOOD. Well done.
    Lastly, regarding the very-present advertisements during the shows–I can’t say I hate the commercials.. Hey, for $8 a month, I’m happy to pay attention to the excellent, tailor-made ad-campaigns you have running..
    JASON, if we were in the same room, I’d give you a hug & a smooch on your cheek, and tell you, “Good JOB, man!”
    HULU/HULU PLUS offers a great product (and service) to virtually EVERYONE on the planet.. Your company is RELEVANT and USER-FRIENDLY–and you are NOT ripping people off.
    lol.
    YAY.
    Thanks so much–for being a part of the solution..
    We all know what THAT means——-you’re NOT part of the problem.
    Respectfully,
    Angela Blackwell

  • Angela Sherman-Blackwell says:

    JASON, hello. Do they call you Mr. Hulu?
    My name is Angela… I just read your exciting blog.. Congratulations! Rock on.
    HULU PLUS ROCKS, DUDE.
    I am an incredibly satisfied new subscriber to HULU PLUS… Haha, lucky for me (and for you…), the reason I joined HULU PLUS was somewhat on a whim.. My husband and I were doing an IMDB search on Edward James Olmos… I was then enlightened that I had somehow completely missed the existence of the 2003-2009, miniseries-turned-series, “Battlestar Galactica.” I thought it was worth a look. It was!
    (WINNER WINNER CHICKEN DINNER)
    After some “bitTorrent-ial” headaches, I thought, well, let’s check HULU. I’d had some fun dabbling around HULU in the past, delighting in the series, “HUMAN TARGET.”
    After viewing a clip/trailer of, “Battlestar,” I realized HULU was now offering HULU PLUS, allowing me the option to delve into the complete series. I chuckled, and thought, well, for $8, I’ll give it a whirl.
    To my delight, I found I could access every last second of anything and everything, “Battlestar,” (and for that matter, your incredibly vast library) for $8/month… Not to mention, this is on a month-to-month agreement, with no commitment, and HULU PLUS accepts prepaid cards to boot. I even got a month free for pinning the “H” to my windows task/toolbar.

    Also, I am no longer a cable TV subscriber, as my penchant for “viewing options” was proving to be outrageously expensive, costing my family over $3000 a year..
    I decided to “go social,” per HULU’s suggestion, and skeletally connect my HULU PLUS to my FACEBOOK. I’d had some comments I was hoping to share, regarding my complete satisfaction in viewing, “Battlestar Galactica,” on HULU PLUS… I then came across your blog, and was thrilled at the spike-y climb I viewed on your chart of new subscribers (above).
    I also thought, hmmm, I might want to look into applying for employment in some capacity, with my new favorite not-so-guilty pleasure, HULU/HULU PLUS..
    So, FYI, I’m diggin’ HULU PLUS. I’d have to say you guys right up there with SLICED BREAD on the “great-o-meter.”
    In a nutshell, Mr. Jason Kilar–YA’ DUN REAL GOOD. Well done.
    Lastly, regarding the very-present advertisements during the shows–I can’t say I hate the commercials.. Hey, for $8 a month, I’m happy to pay attention to the excellent, tailor-made campaigns you have running..
    JASON, if we were in the same room, I’d give you a hug & a smooch on your cheek, and tell you, “Good JOB, man!”
    HULU/HULU PLUS offers a great product (and service) to virtually EVERYONE on the planet.. Your company is RELEVANT and USER-FRIENDLY–and you are NOT ripping people off.
    lol.
    YAY.
    Thanks so much–for being a part of the solution..
    We all know what THAT means——-you’re NOT part of the problem.
    Respectfully,
    Angela Blackwell

  • Jim says:

    A lot of people complain about the ads but the truth is I’d rather pay $8 for a few ads with Hulu Plus than $80 for many ads with cable or satellite.

    And I also don’t want you to sell to Yahoo. They would probably rename it Yahooloo.

  • b says:

    wheres my free month

  • Wipeoutt31 says:

    Please do NOT sell to Yahoo. Thank you that is all.

  • [...] Web TV network are anticipate exceeding 1 million paying subscribers before the end of the summer; previously they had forecast crossing that threshold around the end of the year. Hulu Blog [...]

  • Botox says:

    If there was an option to watch Hulu+ for 8$ with ads, and allow us to pay more to watch Hulu+ without ads, that would be perfect.

  • Alexander says:

    PLEASE LET US PAY TO MAKE THE ADS GO AWAY!

  • Paid_sub says:

    Starz would be a good addition. Spartacus is awesome and Torchwood was great on BBC!

  • Paid_sub says:

    The service doesnt work well. I often have trouble streaming to my iPad and unfortunately the service is not available on apple tv or my samsung DVD player (purch in Dec 2010), so I’m kind of screwed. Also, would prefer to pay more and not have ads.

  • George says:

    I have been a Hulu Plus subscriber for 3 months. I have seen the ads increase 200%. In the first month you had at most 2 ads per 30 minutes of programing. Now it’s 8 per 30 minutes of programing. I subscribed to get away from all the ads on pay TV and you are going the same direction. I don’t think this is anything to brag about. Please get rid on the ads.

  • Dann says:

    More content, please!

  • Jared says:

    Odd thing to tout as an accomplishment – that you provide twice as many ads as any other paid service. I don’t want to watch ads on a paid service that provides little quality programming to begin with,

  • Suzanne says:

    Hi. Once again I came by to check my queue. Will all the huge tech improvements you speak of, why is it so difficult to indicate which entries are CC for the 35 million deaf/HOH Americans who could be enjoying your site? And becoming paid members? And why are so many clips not CC? We need this remedied. Of course, it is a lot of lost revenue for you, too.

  • billy_v says:

    If all it takes is approximately $8 per month to have all the Hulu+ content why can’t you offer the end user a model at $15 per month for zero advertisements. I would gladly throw $15 per month at your service, letting you pocket the extra $7 (and you would not need the same overhead of additional ad sales team/support). Please make this happen.

  • Thomas says:

    It makes me really happy when companies like Hulu succeed. I’ve been a member of too many online subscription services that were either shut down or absorbed by larger companies (Lala.com being the most disappointing that it was shut down). It’s great to see Hulu doing so well because that means I’ll be able to enjoy it for (hopefully) years to come.

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