It's becoming clearer by the week that the pay TV industry, or at least a growing segment of it, is A-OK with OTT.
Just a week after Cablevision Systems became the first multichannel video programming distributor to ink a distribution deal with Hulu, the over-the-top SVOD streaming service, five more joined the club during last week’s INTX confab — Armstrong, Atlantic Broadband, Mediacom Communications, Midcontinent Communications and WideOpenWest.
While Cablevision was originally coy about pricing when it announced its deal, a Hulu official confirmed that its MVPD partners will sell the subscription OTT service for the current going rate of $7.99 per month.
What remains secret is when those pay TV partners will start to offer Hulu to their respective subscribers and how they will market the streaming service.
Joe Canavan, vice president of product management and sales at Atlantic Broadband, shed some light on the coming multiphase plan.
“First and foremost, this is a continued expansion of our OTT strategy,” Canavan said, noting that Atlantic Broadband was among an initial group of U.S. TiVo partners that integrated Netflix last year.
In ABB’s case, the early part of the plan is to integrate the Hulu app on TiVopowered boxes that the operator leases to pay TV customers. In addition to tying Hulu’s catalog into the platform’s search and discovery system, the operator also intends to offer some genre-based Hulu “channels,” such as one focused on kid’s programming, that deep-link the viewer to specific Hulu titles.
While Hulu will continue to have a direct relationship with its subscribers and bill them directly in the early going, there’s flexibility in the deal to sell Hulu directly with an Internet service or with various other bundling options. In some of these future scenarios, the MVPD will own the billing relationship, Canavan said.
“But the initial focus is to get Hulu into the box and our TV Everywhere catalog … and then to figure out how to offer Hulu subscriptions directly to customers,” he said.
When it comes to MVPDs’ embrace of OTT video, Canavan said, “We are at the tip of the spear.”
Direct distribution agreements with MVPDs could open new sales opportunities for Hulu, which is co-owned by NBCUniversal, Walt Disney Co. and 21st Century Fox. Last month, Hulu announced it had nearly 9 million subscribers , a 50% increase since 2014.