The End of Free

10 05 2010

We all knew this day would come. Hulu has announced they will go down the inevitable route of paid services. And soon…

In late April, Hulu announced that they will begin implementing a paid subscription service as early as late May 2010. The website, which offers video streams of many popular television shows and movies, is owned by a conglomerate of giant media moguls NBC, News Corp., and Walt Disney Co. It usually hosts the five most recent episodes of select shows, and has limited commercials throughout the stream.

But all is not lost for those “free Internet” advocates. Hulu’s paid subscription, “Hulu Plus” will run about $10 per month, and offer additional episodes and services compared to their free service, which will still be available.

The main reason, as with any business, revolves around revenue. The limited commercials currently on Hulu pull in some advertising money, but the numbers are not as high as the owners’ would prefer (is it ever?). There is speculation that the free service will soon begin to show even more commercials, rivaling the amount currently shown on broadcast television.

But Hulu isn’t the only website to offer video streams of television shows. Nor will it be the first the offer a subscription services. Fancast, owned by Comcast, runs on a fairly similar model, offering free content. And Netflix has been charging for service from the beginning, but is doing very well.

I like to link the switch to the recent attempt of Spirit Airlines to charge for carry-on baggage. Others will wait and gauge the reaction, and then decide to either follow suit, or abandon the idea to keep their fan base.

The Internet has always been the home to “free” and many users want to keep it that way. While Hulu currently ranks #2 in online video streams (second only to YouTube), it is possible this subscription service could make that number drop dramatically.