Hulu CEO Jason Kilar will be stepping down from the company next month, but there may be some even more radical changes in the service's future. Bloomberg and the Wall Street Journal are both reporting that Disney and News Corp. have been holding discussions about Hulu, with both sides open to selling their stake in the company to the other — or to an outside party.
Subscriptions vs. ads
The two companies have disagreements over what the service's core business model should be: Disney prefers an ad-supported model, while News Corp. sees subscriptions as the best area to focus on. Currently Hulu straddles the fence, offering a free version along with its expanded Hulu Plus subscription service, though the latter still interrupts viewers with advertisements. Disney and News Corp. each own roughly a third of the company, with Comcast owning the majority of the remaining third. Due to regulatory restrictions put in place with it acquired NBCUniversal, however, Comcast is not allowed to participate in any operational capacity.
The subscription business has failed to take off for Hulu the way it has for some of its competitors. Netflix announced over 27 million streaming subscribers as of the end of last year; Hulu, in comparison, hit just three million. It's not apparent which direction Hulu will end up going — or if it will end up in the hands of an entity with entirely different ideas — but it's clear that the shaky ground it's been on could soon grow even more unstable.