Hulu Plus subscriptions hits 2 million, accelerates revenue

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Hulu Plus, Hulu’s paid subscription service, has hit 2 million users and is helping put the company’s revenue on a faster pace than last year, said Hulu’s CEO Jason Kilar. Speaking at the Ad Age Digital conference in New York, Kilar said the milestone makes Hulu Plus the fastest growing video subscription service in the U.S. to hit the 2 million subscriber mark.

Kilar said the company is off to a faster revenue pace than last year, when Hulu grew revenue by 60 percent over the previous year to $420 million. He said the growth of Hulu Plus along with the robust online advertising market are helping accelerate Hulu’s revenue growth. Kilar said the $8-dollar-a-month Hulu Plus service is providing users with good value and the revenue is helping pay for more content, which is helping improve the service and make it more appealing.

Hulu’s subscriber base has grown from 1 million users last summer and 1.5 million as of January. The service is expected to account for more than half of Hulu’s overall revenue later this year.

Hulu is also looking at improving the situation for advertisers by charging only for completed video advertisements. The standard used to be that advertisers were charged for any video ad that was streamed even if it wasn’t watched to completion. The completion rates for Hulu ads are already 96 percent, well ahead of the industry norm, so it’s not going to mean too much of a loss in volume. But the move helps advertisers get more comfortable with advertising on Hulu and addresses the 4 percent of advertisers who are still paying for ads that don’t get watched all the way through.

Kilar said the move is part of Hulu’s vision for the future of TV, in which ads will be even more relevant and personal for users and will support a higher fidelity conversation for advertisers.

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