Online television services
As viewers, particularly Millennials, increasingly prefer to watch content online, the online streaming market continues to expand with new entrants. Hulu is another streaming player that plans to launch an online television service in the first quarter of this year. Earlier this month, according to a report from TV Guide, citing Hulu CEO Mike Hopkins, Hulu has entered a content licensing agreement with CBS (CBS) for Hulu’s online television service.
Mike Hopkins was speaking at the Citi Internet, Media & Telecommunications Conference. As a part of this agreement, Hulu’s online television service will stream live CBS content and will have a limited number of recently telecast episodes. According to the TV Guide report, Mike Hopkins also stated that Hulu’s online television service will cost around $40 per month.
Late last year, the Wall Street Journal reported that Alphabet (GOOG) had signed up CBS (CBS) to carry the network on YouTube’s online television service that is likely to debut this year. According to the report, the new service will be called Unplugged. According to “media executives,” the service is likely to be priced between $25 and $40 per month.
Intense competition in the OTT space
This intense competition in the over-the-top space could add to pay-TV operators like Dish Network’s (DISH) woes. This rising trend of new entrants in the OTT space priced competitively could result in Dish being forced to modify its Sling TV packages, which could affect the company’s margins.
However, Dish noted earlier that it hasn’t observed any cannibalization of Dish’s pay-TV subscriber base by its Sling TV service. According to Dish, the customer base is different for both these services. Dish added that it believed that its Sling TV service offers it an opportunity to enter new markets where it’s not physically possible for the company to install a satellite dish.