Hulu has announced that it has distribution deals with 5 small-to-mid-sized U.S. pay-TV operators: Armstrong, Atlantic Broadband, Mediacom, Midcontinent and WideOpenWest (WOW!). The deals follow last week's news that Hulu has signed up Cablevision as the first U.S. pay-TV operator to distribute its service.
Like the Cablevision deal, there weren't a lot of specific details shared about pricing or packaging. The 5 operators will be able to offer Hulu's content on their advanced set-top boxes. While the set-tops aren't identified, a number of these operators use TiVo DVRs as their advanced set-tops to offer integrated OTT/pay-TV/VOD experiences.
It's also worth noting that all of the 5 operators, except Armstrong, have previously announced deals to promote Netflix via integrated experiences (Mediacom just announced their Netflix deal yesterday). Last week, I suggested that it was all but inevitable that Cablevision would soon announce a Netflix partnership, making it the largest U.S. operator to have one.
All of this activity among smaller operators highlights how OTT services are being embraced by pay-TV operators to complement their broadband businesses. There's a compelling argument to be made that one integrated living room experience that eliminates the need to switch inputs to access a device like Roku, Apple TV, etc, is a major convenience benefit to subscribers. The OTT services also give pay-TV operators leverage in negotiations with cable TV networks seeking ever higher rates.
The big question arising from the smaller operators' push to include OTT is whether it will be adopted by larger operators as well. With yesterday's news that Comcast now has more broadband subscribers than video subscribers, it's hard to see a Netflix deal not being tempting for Comcast too (as I proposed last October). Yet another wildcard is how operators will react to HBO's overtures that HBO Now be part of a broadband bundle.
All in all, the new Hulu deals further underscore the changing dynamics in the pay-TV/OTT businesses. While historically viewed as silos, more and more the two look like they're coming together.