Hulu's Connolly: MVPD relationships built on revenue sharing, keeping user experience intact

CHICAGO--With his SVOD service making a flurry of MVPD partnership announcements in recent weeks, Hulu distribution chief Tim Connolly used an INTX panel focused on OTT distribution to better explain how these arrangements work.

To start, they're based on revenue sharing, he said, with operators taking an undisclosed portion of the monthly $7.99 subscription price for the service. Cablevision (NYSE: CVC) is among a handful of MSOs that have signed up to integrate Hulu into their set-tops later this year. Mediacom, Atlantic Broadband, Midcontinent Communications, Armstrong and WideOpenWest are also integrating the service. 

"We have complimentary catalogs with MVPDs," Connolly said. "They're focused on the most recent episodes, and our content is mostly back catalog and archival seasons. And presenting a holistic environment is something an operator like Cablevision wants."

Hulu, he added, will be integrated into the set-top software of MVPDs so that, if you search for a show like Empire, the SVOD service will be one of the destinations the user is directed to in order to watch the show. 

"We'll essentially have the Hulu application resident on the set-top," said Connolly, a former Disney executive who joined Hulu in March 2014. "We have tried to be very sensitive in regard to how we integrate with all of our partners' user interfaces," he added, noting that Hulu is seeking to keep its own users' experience intact as it distributes its service through cable operators. 

"We're not comfortable doing what other networks have done, which is just give the assets to the MVPD for them to host and stream," he said.

Speaking on a broad number of issues, Connolly also recommended sentiments expressed by Roku pay-TV chief Andrew Ferrone at NAB last month--there are too many OTT devices in the living room that must be supported. 

While PC and mobile devices are each dominated by two platforms, "the living room environment remains fragmented," Connolly said. "In some cases, we have to negotiate deals with 25 different device partners."

Show coverage: INTX Live 2015

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