Cablevision Becomes First Cable Operator to Offer Hulu to its Customers

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By Tim McElgunn

April 28 — Cablevision Systems Corp. is going “over the top” again—this time with Hulu.

The Bethpage, N.Y.-based cable operator announced today that it plans to make Hulu available to its Optimum Online customers as part of a subscription, continuing a push to offer more broadband-delivered content directly to its subscribers. The announcement comes on the heels of Cablevision's launch of an array of bundled packages targeting cord cutters, which come with the company's Optimum Online broadband Internet access service and an over-the-air antenna. Cablevision, for its part, also was the first in the cable industry to add the HBO Now streaming service as an option for subscribers.

“The partnership with Hulu reflects Cablevision's desire to meet customers where they are,” said Kristin Dolan, Cablevision's COO, said in a statement April 29. “There is a new generation of consumers who access video through the Internet, and whatever their preference, Cablevision will facilitate a great content experience.”

Cablevision joins other service providers, including Comcast Corp., that have offered introductory packages featuring a limited selection of channels for as little as $19 a month. The bundles tailored to viewer interests are a reaction to the threat from Web-based video streaming services such as Netflix Inc. and Amazon.com Inc. Dish Network Corp.’s Sling TV started in February with 20 channels for $20 a month.

Cablevision's chief competitor, Verizon's FiOS service, is attempting to address cord-cutting sports fans' demands with a $55 per month pared-down package of base channels and $10 per month add-on packages, including a sports bundle, but has hit strong opposition from ESPN owner Walt Disney Co. and other content owners including 21st Century Fox Inc. ESPN is suing Verizon claiming that the service violates the terms of the companies' contract.

Cablevision Adds ABC, FOX, NBCU Streaming Content

Hulu, which costs $7.99 per month as a standalone service purchased directly from the company, provides content from its owners Disney’ ABC, Fox, and Comcast's NBC Universal. In addition, the service has rights to deliver streaming content from Time Warner's Turner Broadcasting unit. Hulu also produces some original content.

To date, service only has been available as a Hulu subscription delivered to Internet-connected computers, streaming devices, mobile devices, game consoles and smart TVs. Hulu shares advertising revenue with its content partners.

“Even with the rapid growth in streaming, there is a huge audience that consumes television through their cable provider, and we want to be there for them too,” said Tim Connolly, Hulu's president of distribution, in a press release announcing the Cablevision deal.

Hulu Reported a Factor in Camcast-TWC Deal's Demise

Before the Comcast-Time Warner Cable Inc. deal was cancelled last week, Bloomberg News had reported that the Department of Justice was reviewing whether Comcast was too actively involved when co-investors Fox and Disney tried to sell Hulu in 2013. Maintaining a passive position in the venture was among the conditions Comcast agreed to in order to win approval of its March 2013 purchase of NBCUniversal LLC. According to Bloomberg News, Comcast was asked by DoJ staffers about whether it worked to prevent the sale of Hulu in 2013, and the company told its partners that it could make Hulu “the cable industry's answer to Netflix.”

With Comcast's TWC deal scuttled, it is unclear whether the DoJ will continue to investigate the issue.

To contact the reporter on this story: Tim McElgunn in Cherry Hill, NJ at tmcelgunn@bna.com

To contact the editor responsible for this story: Bob Emeritz at bemeritz@bna.com