Hulu targets younger viewers, plans original web TV shows

Los Angeles: Hulu, the Internet video operator owned by Walt Disney, News Corp and Comcast, is launching 10 original series aimed at younger viewers who are deserting television for online platforms.

The company, which was set up five years ago as a counterweight to Google's YouTube, has built a subscriber base of about two million with a library of programmes that have already aired on US television.

But like Netflix, a larger service with close to 25 million subscribers, Hulu sees its future in original programming. "We want to offer exclusive shows and make original TV programming that speaks to a passionate group of fans," said Andy Forssell, senior vice-president of content for Hulu.

The launch of the new series, from directors such as Richard Linklater and Kevin Smith, comes amid shareholder friction about the future of the company.

Providence Equity Partners, one of Hulu's investors, is in talks to sell its 10 per cent stake. It wants Hulu to grow more quickly and build a presence online with exclusive rights to hit shows.

Providence bought its stake for $100 million, valuing the company at $1 billion, and wants a sale price of about $200 million. It has found itself at odds with the media companies that are the other shareholders in Hulu. Walt Disney, via its ABC network, News Corp, via its Fox subsidiary, and Comcast, which owns NBCUniversal, supply Hulu with much of its programming, providing hits like Modern Family, Saturday Night Live and 30 Rock. Disney and News Corp do not want Hulu to cannibalise revenues from their broadcast TV operations or erode the growth of their online video sites. They have resisted giving Hulu exclusive rights to content, which has caused the company's management considerable frustration.

Some of these disagreements came to light last year when Jason Kilar, Hulu's chief executive, posted a blog that excoriated the traditional network TV business model, saying "traditional TV has too many ads" while boasting that Hulu's advertising was "two times as effective as traditional TV video advertising".

One shareholder at the time told the Financial Times Kilar was "obviously disconnected from how the majority of America watches television".

Since then Hulu's growth has also been curtailed by a push to "authenticate" its viewers by proving they subscribe to a pay-TV service. Subscribers to Dish Network and Verizon's cable TV services can watch shows on Hulu the day after they have aired but other users have to wait more than a week.

— Financial Times