The hunt for the elusive “cord cutter” is heating up! Hulu became the latest contestant when they announced their own “skinny bundle” offer (available in 2017). Hulu is hoping its brand, built-in subscriber base, large catalog of back content, and local and sports programming from ABC and Fox networks will be its winning edge. However, with the likes of Sling TV, PlayStation Vue, and the raft of “skinny bundles” offered by traditional TV service providers, Hulu’s expected $40/mo price may be its undoing.
Hulu vs. Sling TV
Skinny Hulu is essentially a Sling TV Plus option. It's everything you’d get from Sling TV plus ABC, Fox Sports, and access to an online content catalog. The problem is that it’s twice as expensive as Sling TV. And remember, for the "cord cutter" cost is king. By bundling Sling TV (and their ABC add-on for $5) with Hulu's basic "Hulu Plus" package, consumers would get almost the same offer and still save $7/mo. Only regional sports would be missing from this handmade bundle.
Hulu vs. PlayStation VUE
Hulu has many of the same advantages when compared to PlayStation Vue. Yet, PlayStation Vue – at $10/mo less – has something Hulu currently doesn't: NBC programming. NBC and NBCSN are big draws for sports fans with access to Sunday Night Football, NHL, NASCAR, and English Soccer. Again, Hulu's main draw is regional sports, but it's lack of NBC programming offsets that advantage.
Hulu vs. Traditional TV Service Providers
When considering skinny video options, it’s easy to forget the familiar traditional service provider. But for Hulu – and Sling TV and PlayStation Vue – that comparison is where they lose the most value. The big reason is price. While these OTT offers may seem cheap, you have to remember that they don’t include the required Internet access (oops!). Our data tells us the median Internet offer across the U.S. is 12 Mbps for $39.99/mo; hardly ideal to stream video. If you upgrade to a faster speed (which seems likely), customers of Hulu's may be looking at a bundle costing $90/mo or more.
On the same token, many of the traditional service providers offer solid entry-level double plays in the $60 - $80/mo range. And these offers include ESPN, regional sports, all the broadcast channels (Hulu doesn’t include either NBC or CBS), plus an extra 50 to 100 channels not offered by Hulu, Sling TV, or PlayStation VUE.
Feature Comparison Table
|Hulu||Sling TV||PlayStation VUE||Traditional Service Provider|
|Notable Included Channels||ABC, Fox, ESPN, Disney||Fox, ESPN, Disney||ABC(OD), Fox(OD), NBC(OD), ESPN, Disney||ABC, Fox, NBC, CBS, ESPN, Disney, more|
|Notable Missing Channels||NBC, CBS||NBC, CBS||CBS||N/A|
|Backlog of Content||✔||Limited||✔||✔|
Price Comparison Table
|Hulu||Sling TV||PlayStation VUE||Traditional Service Provider^|
|Internet Speed||12 Mbps*||12 Mbps*||12 Mbps*||100 Mbps|
Hulu’s new offer might attract a narrow consumer base (most likely from Sling TV and PlayStation Vue users) but doesn’t seem poised to be a substantial threat to the traditional service provider.
*UPDATE – 8/3/2016*
On 8/3/16, Time Warner acquired a 10% stake in Hulu's announced skinny bundle. This news suggests that many of Time Warner's channels will be available on the streaming service including TNT, TBS, CNN, Cartoon Network, Adult Swim, truTV, Boomerang, and Turner Classic Movies. The big news for our analysis is the addition of TNT, TBS, and truTV. These channels all host live sports including the NBA, MLB, and March Madness. In fact, we have seen bumps in interest for Sling TV during March Madness, so these channels by themselves may draw interest. However, we're not sure it’s enough to change our verdict. Firstly, because we would expect to find these channels in an entry-level double play from a traditional service provider. And secondly, Hulu’s skinny bundle still requires Internet service to function which adds to Hulu’s already high expected base price – a price which may increase after this announcement. Traditional service providers shouldn’t fear Hulu’s skinny bundle.
*Based on the median Internet offer from 23 providers across 30 U.S. markets ^Based on Verizon Fios Custom TV - Sports & More + 100/100 Mbps offer; As of 5/6/2016 in select markets