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.