The CW struck a five-year licensing deal with Hulu for rights to stream in-season episodes of its programming on the Hulu Plus subscription service and the free, ad-supported Hulu service. In the deal, The CW, a JV of CBS Corp. and Warner Bros. Entertainment, also granted Hulu Plus to be the only online subscription service to carry in-season episodes its drama and reality series, with the five most recent episodes of each show available to subscribers the next day after airing.
Users of the free Hulu service will be able to watch five episodes of current season programming eight days after airing. Available later this year, programming on Hulu and Hulu Plus will begin with the nine series on The CW’s Fall 2011 sked, including new series “Ringer,” “Hart of Dixie” and “The Secret Circle,” as well as returning hits “The Vampire Diaries,” “Gossip Girl,” “Supernatural,” “Nikita,” “90210” and “America’s Next Top Model.”
The new agreement also provides the network with off-air promotion and marketing to grow its brand, as well as increase awareness for its series. The CW’s content can also be made available online through authenticated cable providers.
The CW will continue to present its programming on cwtv.com with a full complement of advertising, prior to streaming on Hulu’s free service.
Marci Ryvicker, Wells Fargo securites analyst, notes that his deal differs from the Netflix deal in that it is a licensing deal, not an output deal with more limited content. She adds, “While this deal is not financially significant to CBS in and of itself, what’s good for The CW is good for CBS. More importantly, though, this is another way that CW can approach breakeven and ultimately reach profitability, which is clearly good for CBS as it owns 50% of the network.”
She also does not think that this changes CBS’ stance regarding the availability of CBS content on Hulu. “Recall that CBS recently signed an agreement with Hulu in Japan (this is a subscription service although not called Hulu Plus). However, CBS has not made its content available on Hulu in the U.S. As we said with the CW-Netflix output deal, CBS content is very different and has a much larger backend opportunity than the CW. We think CBS will continue to monetize catalogue product through SVOD.”