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.
Such a move would be a significant shift in strategy for Hulu,
which up to now has required users to sit through ad breaks during
programming, even if they are paying $7.99 a month for its premium
subscription service.
Rivals Netflix and Amazon.com Inc.'s Prime Instant Video,
meanwhile, have highlighted the fact that they don't show ads as a
key selling point to consumers. Offering an ad-free tier would
signal that Hulu recognizes how popular that approach is with many
consumers.
Hulu's code name for the project is "NOAH," which stands for "No
Ads Hulu," the people familiar with the matter said. One of the
people said the ad-free option could launch as early as this fall
and be priced at around $12 to $14 a month.
Such a price point, relatively high in the streaming world,
would show that Hulu and its owners don't want to encourage large
numbers of existing subscribers to shift to the new ad-free
service.
Hulu is jointly owned by media giants 21st Century Fox, Walt
Disney Co. and Comcast Corp. (Fox and Wall Street Journal-owner
News Corp were part of the same company until 2013.)
Write to Mike Shields at mike.shields@wsj.com and Shalini
Ramachandran at shalini.ramachandran@wsj.com
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