Hulu's Dual Revenue Streams

This week Hulu CEO Mike Hopkins gave some interesting insight into his company's decision to offer 2 tiers of service: a $7.99, limited ad-supported tier and an $11.99, ad-free tier. According to Hopkins, a major factor in the decision was a high number of user complaints about ads, but he also noted that having a dual-revenue stream will allow for higher average revenue per user and allow for more investment in original content. At a summit on Friday Hopkins said "Consumers were going to give us a little bit more money for their time or they'll save some money and give us their time to interrupt it for advertising. And this works ... Almost overnight, the complaints about advertising on the limited-commercials plan plummeted." Read the full story here.