• Discovery Strikes Its First Distribution Deal With Hulu

    Discovery has unveiled its first distribution deal with Hulu this morning. The most prominent program included in the SVOD deal is "Deadliest Catch." Other programs included are "Mythbusters," "The Little Couple," "Say Yes to the Dress," "Treehouse Masters," "How It's Made" and "Homicide Hunter." The programs will become available on January 1st.

    The deal is noteworthy because Discovery has been among the most cautious cable TV networks in licensing its programming to SVOD providers. A deal that Discovery had with Netflix appears to have expired recently with all Discovery, Animal Planet and Learning Channel programs pulled from the SVOD service.

    Discovery's deal with Hulu also plays out against the raging debate over whether SVOD services are starting to negatively impact TV networks' ratings. As I noted last week, new Nielsen data shows that linear rating are down across all age groups from Q3 '13 to Q3 '14, while online video usage increased across the board. In Q3 '14 Discovery's C3 ratings were down 11%, putting it in the middle of the cable TV network pack in audience declines.

    TV networks and content owners are in the catch-22 position of welcoming the short-term benefit of SVOD licensing revenue while recognizing the long-term risk to their ad-supported linear viewership model. With the issue gaining far more attention, it will be interesting to see whether we'll see more licensing deals like Discovery's with Hulu in 2015, or fewer.