New York – The management of video portal Hulu and its
corporate owners — NBC Universal (NYSE:  GE), News Corp. (NYSE:  NWS) and Disney (NYSE:  DIS) — are reportedly at
odds over the current service, and contemplating a new "online cable
operator" business model, according to The Wall Street Journal. Networks
have complained that Hulu’s free, ad-supported service is draining ad revenue
from their own network websites, and News Corp. and Disney are considering
pulling some free content from Hulu — or else delaying availability until two
weeks or more after broadcast — sources told The Journal.

"It remains
unclear what the business model is [for Hulu]," Bruce Rosenblum, head of
the television unit at Warner Bros. (NYSE:  TWX), told The Journal.

"At some point, if
enough people turn off cable, then you’ve got a complete disruption of the
business model."

The company recently debuted a new subscription-based
offering, Hulu Plus.

The Journal cites sources who say Hulu CEO Jason Kilar
reportedly threatened to quit if the owners didn’t heed his recommendation to
drop the price of Hulu Plus from $9.99 to $4.99 — to match the price of
Netflix’s (NASD:  NFLX) similar video streaming service.

A compromise of $7.99 was eventually

The company’s corporate owners are now reportedly considering
management’s plan to mold Hulu into a "virtual cable operator," which
"would use the Web to send live TV channels and video-on-demand content to

Last summer, Hulu explored but eventually tabled the idea of
an IPO; CEO Kilar is now reportedly seeking new capital elsewhere, including
from the company’s broadcast owners.



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  1. Just when the people get what they want; a decent service with minimal advertisement. This just makes me sick. I don’t even mind paying a small subscription fee, but I WON’T GO BACK to a cable like system. It’s complete crap. I was paying an obscene amount of money for a service that I was only using a small portion of. People want to watch the shows the like, when and where they want to, on the medium of their choosing. UGGGGGG…. This is so frustrating. I give up. If this happens, I’m just going to stop watching filmed content all together.

    So, to sum it up: Apparently, what the people want is wrong according to the cable companies. So, on behalf of the people, I’d like to give the cable companies one giant FU!!!!!