Hulu, the streaming service that enables users to view TV shows, movies and clips online, is considering offering its subscribers an ad-free subscription.
The U.S.-based company is currently ad-supported, but if the whispers are true, then Hulu is looking to also take the commercial-free route. The news is courtesy of reputed publication The Wall Street Journal's reliable sources.
"Hulu is exploring plans to add an advertising-free option to its service, according to people familiar with the matter, as the streaming video provider tries to become a stronger rival to Netflix Inc," reported the WSJ.
The publication's sources also let on that the new ad-free subscription tier will be priced from $12 to $14 per month, making it more expensive than the current premium tier of the service, which is priced at $7.99. However, the $7.99 monthly subscription has ads, which users are compelled to view in the middle of their streaming.
The impending ad-free subscription has been codenamed "NOAH," which basically stands for "No-Ads Hulu." The WSJ's sources hint at a fall launch for the new service.
By comparison, Hulu's rival Netflix has a commercial-free plan already in place.
While Hulu's alleged price point may be steep, the service is obviously looking to be in the same league as competitors Netflix and Prime Instant Video from Amazon. While an ad-free option would make Hulu more attractive to consumers and give them an alternative, the high pricing could mean that not many people may be able to switch to NOAH and may just continue on other plans. The company could, however, still rake in essential revenue from ads.
Hulu's challenge would undoubtedly lie in roping in new subscribers to add to its 9 million subscriber base, without reducing the sales volume of its current business that is primarily supported by ads.
With Netflix allegedly looking to increase its charges as well, users may take a shine to Hulu's offerings. However, Netflix will reportedly raise the fees owing to the fact that it will add extra original content.
"We want to take it very slow," Reed Hastings, CEO of Netflix, said. "Over the next decade I think we'll be able to add more content and have more value and then price that appropriately."
With the price wars for online streaming services raging on, we can only hope that the consumer is the ultimate winner.
