Why Hulu Can Recover Without ‘SNL’ and Other NBCUniversal Shows | Charts
NBCUniversal recently announced that it will end its content-sharing arrangement with Hulu this fall, pulling next-day access to some of its most popular series and nearly all of its library titles in order to host that programming exclusively on Peacock instead. The move deals a blow to Hulu, which has built up a strong content offering with next day-episodes like NBC’s “Saturday Night Live.”
But Hulu can survive the blow.
NBCU’s decision to remove next-day streaming for some of its most in-demand series seems inevitable in hindsight, but it also leads to questions about what a further pullback from Hulu could look like in the years to come.
When considering the demand for all shows available on its platform, Hulu is the leader in the U.S., according to Parrot Analytics data. The Disney-controlled streamer holds a 20% share of demand across all content available on SVODs in the U.S. last quarter. The platform’s deep library of programming means Hulu is a consistent leader in this measure.
And yes, Hulu’s current demand share is in no small part boosted by the high demand for content it licenses from NBCU. More specifically in Q4 2021 (Hulu’s Q1 2022), NBCU shows accounted for 16.2% of demand for all series available on Hulu. As a point of comparison, the demand for NBCU shows on Hulu was greater than the combined demand for Hulu originals and FX series on the platform.
As NBCU plans to end a core aspect of its content sharing agreement with Hulu, this slice of content on Hulu’s platform is at risk. Of the shows that Hulu will lose the next-day rights to stream, “SNL” is the crown jewel. The sketch comedy series is regularly among the most in-demand shows in the U.S. The long-running series’ cultural commentary and guest stars make the timeliness of having episodes on-platform the next day all the more valuable. Gaining the exclusive rights to this is a major win for NBCU’s Peacock.
NBCU’s move to reclaim its content is not a surprise and, in fact, Hulu has taken proactive actions to mitigate the impacts of the sudden gap in its offerings.
“With the proliferation of streaming services entering the marketplace, we have long anticipated changes to our third-party content offering and over the past few years have increased our investment in original content, including popular and award-nominated titles like ‘Only Murders in the Building,’ ‘Dopesick,’ ‘Reservation Dogs,’ ‘How I Met Your Father,’ and the Academy Award-nominated ‘Summer of Soul,’” a Hulu spokesperson told TheWrap after the news broke earlier this month that NBCU terminated its contract.
“As a leading destination for breakthrough storytelling, we continue to transform Hulu into an exclusive home for stories from across The Walt Disney Company and beyond to bring our viewers even more premium content led by Hulu Originals and next-day television programming,” the statement continued.
Comcast, NBCU’s parent company, holds a 33% stake in Hulu, with the remaining majority share under Disney’s ownership.
We’ve measured an increase in demand for Hulu originals over the past few months as it has premiered a number of popular originals that have been among the most in-demand premieres of the past year. Shows like “Only Murders in the Building” and more recently “Pam & Tommy” are helping bolster Hulu’s arsenal of original content.
Highly in-demand original series like these will help the platform guard against any future losses of licensed content. Buying directly from Disney-owned studios will also help Hulu ensure the platform can continue owning any hits the company produces. Hulu originals help the platform define its purpose for subscribers as Disney juggles two platforms (Hulu and Disney+) and tries to show the distinct and complementary value of both.
