Highlighting the steep cost of the original programming arms race currently unfolding in the SVOD market, Hulu’s losses through the first six months of 2017 have spiked 81% to $353 million.
The data comes courtesy of BTIG Research analyst Richard Greenfield, who looked at SEC data filed by Hulu parents Fox, Walt Disney, Comcast and Time Warner Inc.
Greenfield’s analysis also shows Hulu’s losses widening from $72 million in the first six months of 2015 to $195 million through the first half of 2016.
Hulu didn’t immediately respond to FierceOnlineVideo’s inquiry for comment. However, a perusal of parent company 10Q filings reveals that the losses are attributed to an obvious source. “The losses at Hulu were driven by its higher programming and marketing costs,” said Comcast in its July 10Q filing, which shows first-half-year losses increasing from $65 million in 2016 to $116 million this year.
Netflix, the biggest subscription video on demand company, lists its 2017 budget for content at $6 billion—a competitive benchmark that the other two big SVOD companies, Amazon and Hulu, are beholden to match, at least to an extent.
In June, Beatrice Springborn, Hulu’s head of original programming, told the Hollywood Reporter that Hulu is close to Amazon in terms of content spending. Amazon will reportedly spend around $4.5 billion on content this year.
Springborn added that Hulu is looking to maintain a “boutique” feel in terms of size, getting in a knock on Netflix for the size of its executive roster and daunting depth of its programming slate.
“We're absolutely spending on par with Amazon as far as development goes. We have a very boutique approach to talent,” Springborn told the publication. “We're eight executives—not 30. Honestly, I don't know what the number of execs are at Netflix at this point. We're accessible and still not premiering a show every week, so there's an opportunity to have an impact. And we clearly market our shows well.”