Hulu CEO: Ad-Free Plan Hasn’t Hurt Our Ad Business

Hulu’s ad-free tier hasn’t hurt its advertising business, explained the company’s CEO Mike Hopkins on stage at Recode’s Code Media conference in Southern California on Thursday. Instead, Hulu has actually seen its ad business grow 30 percent since launching the ad-free option in September of 2015, Hopkins said.

Hopkins went on to argue that having the ad-free option has helped the company to grow its user base: “There are ad-avoiders and ad-accepters,” he said, adding that ad-avoiders previously also steered clear of Hulu altogether. Now, these users are subscribing: “They wouldn’t have come to Hulu if we didn’t offer a plan like this.”

Still, ad-avoiders are in the minority. “The vast majority of subscribers are choosing the commercial plan.” That’s why Hulu’s owners, which include Disney, News Corp. and Comcast, aren’t too afraid of the ad-free tier, argued Hopkins. “I don’t think we do anything that competes with the core product” of TV networks, he said.

Hopkins also said that Hulu may be building out its subscription business with additional add-on packages. The company started to resell Showtime’s online service to its customers last June. “We will likely add others,” Hopkins said Thursday. However, he rejected the idea that the company is trying to re-create the cable bundle over the Internet with these kinds of add-on options. “It’s not a bundle, it’s (more like) a store,” he said.

Hopkins declined to comment on the company’s plans for an international expansion, and instead said that the company is currently focused on its U.S. business. A question about Time Warner’s reported interest in buying a stake in Hulu also was left unanswered, with Hopkins instead pointing out that Time Warner is already a licensing partner: “We like Time Warner. We have a great operating relationship with them.”

Popular on Variety

More Digital

  • Elite Season 2

    San Sebastian: Spain’s SVOD Players Debate Competition, Brand, Talent

    SAN SEBASTIAN  — Executives from HBO, Netflix, Amazon and Movistar+ and “Elite” co-creator Darío Madrona took to the stage to field questions on the Global Impact of Spanish Series. Here, briefly, are five takeaways: 1.Spain First “La Casa de Papel” was watched by 34,355,956 Netflix accounts over its first seven days,  after a July 19 [...]

  • Tinder - Swipe Night

    Tinder's Apocalyptic 'Swipe Night' Interactive Dating Show Sets Release Date

    Tinder next month will bow its first original entertainment content — “Swipe Night,” an interactive adventure series in which viewers are forced to make dating choices on humanity’s last night on Earth. Variety previously reported details of the location-based social network/dating app service’s foray into original content, which recently wrapped production in Mexico City and [...]

  • Editorial Use onlyMandatory Credit: Photo by

    YouTube Rolls Back Verification Changes, Says Verified Creators Can Keep Their Badge

    A day after announcing significant changes to its verification program, YouTube announced Friday afternoon that it won’t be de-verifying existing creators after all. “We heard loud and clear how much the badge means to you,” said YouTube product manager Jonathan McPhie in a blog post. “Channels that already have the verification badge will now keep it [...]

  • BLive: BitTorrent Live Streaming App to

    BitTorrent to Launch Public Beta of New Live Streaming App

    BitTorrent is getting ready to open the floodgates for its new live streaming app, dubbed BitTorrent Live: The company plans to launch a BitTorrent Live Android app on various app stores as part of a public beta test late Friday, according to a spokesperson. BitTorrent Live, which is also known as BLive, is being described [...]

  • Netflix - Apple TV

    Netflix Stock Drops After CEO Acknowledges 'Tough Competition' Coming From Disney, Apple

    Netflix shares fell as much as 7% Friday to a nine-month low, coming after CEO Reed Hastings commented that the November launches of Disney Plus and Apple TV Plus will introduce a “whole new world” of competition. Hastings, speaking at the Royal Television Society conference Friday in Cambridge, England, said, “While we’ve been competing with [...]

  • Facebook

    Facebook Suspends Tens of Thousands of Apps During Privacy Investigation

    Facebook has suspended tens of thousands of apps ever since it began investigating potential privacy abuses, the company said Friday. The apps in question had been built by around 400 developers, and a suspension doesn’t necessarily indicate actual privacy violations. Facebook began combing through millions of apps that made use of its platform after the [...]

  • tivo logo

    Tivo Plans to Launch Android TV Dongle, Tivo+ Curation App

    DVR maker Tivo is getting ready to release a new device that may not record television at all: The company plans to launch a $50 Roku-like TV dongle early next year, its new CEO Dave Shull revealed in a conversation with CNN this week. The new device will be powered by Google’s Android TV platform, [...]

More From Our Brands

Access exclusive content