A significant number of Hulu’s more than 20 million subscribers are paying for the more expensive limited-commercials option.
That’s according to Fox CEO James Murdoch, who told Recode that about 50% of Hulu subscribers are willing to pay $11.99 per month to cut down on ads popping up during streams. Fox—along with NBCUniversal, Disney and Time Warner—is a part owner of Hulu.
Recode later updated its story to cite insiders who say that more than 60% of Hulu subscribers still take the less expensive, ad-supported tier.
Earlier this month, Hulu revealed that it now has more than 20 million subscribers, but the service has yet to reveal how many of its subscribers are opting for the $40-per-month live-TV service.
Hulu also said it has grown total engagement by more than 60% and that 78% of viewing on the service takes place in the living room on connected TVs.
“Hulu is the complete TV experience for consumers, offering both live and on-demand programming and more consumer choice than ever before,” said Hulu CEO Randy Freer in a statement. “We are the only place that delivers award-winning content, ad loads less than half that of traditional television, with ads that are always viewable and always in a brand-safe environment—and we are leading the TV and advertising industries into the future.”
The strong uptake for Hulu’s more expensive tier with limited commercials is similar to the numbers CBS has been able to put up for its All Access streaming service.
Earlier this month, CBS said about one-third of its 2.5 million All Access subscribers are opting for the $9.99-per-month ad-free tier of the service.
Joe Ianniello, chief operating officer at CBS, said the fact that consumers are willing to pay more for a premium channel experience with CBS shows gives the company some added leverage when negotiating things like carriage and distribution.
“When the consumer is making the choice to pay $10 a month, that speaks volumes and that gives us a lot of strength when we go into those negotiations because we know that the consumer has knowingly elected to pay that. They’re not being subsidized by advertising, or subsidized in big bundle cable package; they chose to do that so that gives us a lot of confidence when we head into those revenue negotiations,” Ianniello said during CBS’ most recent earnings call.
This article has been updated.