Hulu launches DAI into Live TV service

Hulu with Live TV
Hulu is innovating its ad model quickly. (Hulu)

Continuing to develop ways to expand the margins of the virtual pay TV component of its streaming service, Hulu announced Wednesday that it is introducing dynamic ad insertion (DAI) into its live TV service.

The streaming company, jointly owned by 21st Century Fox, The Walt Disney Company, Comcast/NBCUniversal and Time Warner Inc., said it will launch the DAI capability across “select cable networks” and deploy it to additional live content in the “coming months.”

Hulu made the announcement today at its upfront presentation to advertisers in New York. (FierceVideo has a complete rundown of all the original and acquisition-related programming announcements made by Hulu at this event.)

Hulu also announced that its U.S. subscriber base has surpassed 20 million. The company hasn’t disclosed how many of those users subscribe to “Hulu with Live TV,” the product that combines the company’s flagship SVOD service with its much newer virtual MVPD component.

RELATED: Hulu snatches DreamWorks away from Netflix with new multiyear deal

Like other companies competing in live streaming, Hulu is squeezed between high acquisition costs for programming and the need to keep consumer pricing at or around $40 a month. Certainly, similar margin pressures exist for the subscription video on demand component, which has required the company to invest billions into original programming. 

Thus, Hulu is innovating its ad model quickly.

Hulu said that it will soon launch ad-supported downloadable content, allowing users to watch shows on airplanes, trains and in other places that typically don’t have internet connections, while simultaneously enabling advertisers to reach these users.

“Our launch of the industry’s first ad-supported downloadable content experience is yet another example of how Hulu is innovating viewer-first ad solutions to drive powerful results for brands” said Peter Naylor, senior VP of advertising sales at Hulu, in a statement. “With downloadable content, we're offering brands more ways to connect with engaged viewers who love the experience of watching television, wherever they may be.”

Meanwhile, Hulu announced that Nielsen’s Digital Ad Ratings (DAR) for OTT is now its official ad sales currency across all of its platforms. With 78% of Hulu viewing taking place in the living room, the company said DAR “provides accurate, holistic measurement for everyone watching.”