It looks as though Hulu is on the slide, as the Disney, NBC, and News Corp. co-owned service is reportedly losing viewers at an alarming rate. This could explain why the partners were so keen to sell the company last year.
Hulu Losing Viewers
According to Wedbush Securities using comScore data, Hulu viewership has dropped sharply during the course of 2012. In March users watched 156 hours of content through the website, but by August that had dropped to 56 million hours. As a result Hulu’s market penetration has dropped from 3.9 percent to just 1.5 percent.
This is bad news for Hulu, and it looks as though Providence Equity Partners may have chosen the right moment to sell its stake. The questions over the decline have to be why is it happening, and why now?
The Blame Game
Mobile
The first possibility is the switch away from desktops and onto mobiles, with more and more people streaming video on their iOS and Android devices. Doing so may not provide the best user experience, but accessibility outweighs any loss in performance.
Advertising
Another possibility is that the number of ads users are expected to sit through on Hulu has impacted on viewer numbers. In the U.K. I have encountered a similar problem with 4oD from Channel 4, and the number of commercials has stopped me using the service.
Knowledge
Lastly, it may just be that people are more aware of online viewing options now, and so they’re heading for the websites of individual networks rather than relying on a central service which brings them all together. In which case Hulu will have trouble bouncing back.
Conclusions
The comScore data has to be taken with a pinch of salt, but even if the drop isn’t as severe as suggested it will likely be a drop nonetheless. The partners involved in Hulu are thought to be rethinking their strategy going forward.
