But [Hulu’s] owners—industry powerhouses NBC Universal, News Corp. and Walt Disney Co.—are increasingly at odds over Hulu’s business model. Worried that free Web versions of their biggest TV shows are eating into their traditional business, the owners disagree among themselves, and with Hulu management, on how much of their content should be free.
[Hulu’s new President and COO,] Mr. Carey had a very different vision for Hulu, according to people familiar with the matter. The former head of satellite operator DirecTV, Mr. Carey was a big believer in the subscription-TV business. He worried that online video would train a generation of people to expect entertainment for free with advertising. He thought Hulu should be supported by both subscriptions and ads, those people said.
CBS. Fox. ABC. NBC. We can disagree whether this business model is legitimate in the digital age, but let’s not pretend this is unproven ground. Also, let’s not pretend that Hulu is an unprofitable business. They make money.