Hulu LLC, the popular video-streaming website in which private equity firm Providence Equity Partners has a stake, reduced the price of its paid service by 20 percent after an initial trial period, stepping up competition with Netflix Inc.
The Hulu Plus monthly subscription costs $7.99, the Los Angeles-based company said on Wednesday in a statement. The price during the trial period, announced in June, was $9.99.
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Hulu Plus allows subscribers to watch movies and current and past seasons of television shows such as “Glee” and “House” on computers, mobile devices and Internet-connected TVs. The new price goes head-to-head with Netflix, which began testing a $7.99-a-month online streaming-only service in the U.S. last month. Netflix had been offering streaming programs and DVD rentals by mail for as low as $8.99.
Programs on Hulu and Hulu Plus are primarily from owners ABC, Fox and NBC. Users who subscribed during Hulu Plus’s $9.99- a-month preview period will receive a credit toward their next billing cycle, the company said today. New subscribers will get a one-week free trial.
Previously, Hulu offered a smaller selection of shows and episodes for free and depended solely on advertising revenue. The closely held company still offers a free version that provides some movies and the five most-recent episodes of shows such as “Family Guy.”
Providence Equity Partners involvement with Hulu dates back to October 2007, when the Providence-based private equity giant reportedly invested $100 million in the site.
