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Posted this on DIS board as well. This has implications for Netflix, I believe:

https://variety.com/2018/tv/news/pause-advertising-hulu-att-...

Not sure I fully understand this. If someone is a subscriber, one would assume there would never be ads. I'm not sure if it is explicitly stated, but I believe the gist of the proposal is that even those who subscribe for non-ad services may see ads when they pause a program. I'm not sure exactly how the ad would be delivered. It was mentioned that earlier services like TiVo experimented with a similar protocol, but it sounded to me it was more like just an image or words; not really sure, though. Anyone who may have had TiVo may be able to explain it. I assume this time around it would mean a general full-video spot.

Not sure Hulu should do this. Looks to me like Disney wants to keep the basic cable model -- carriage fee plus ad, even in the OTT-subscription world. I don't think consumers will like it, but at the same time, I do see the need for ads in some capacity. Maybe product placement is more the way to do it. As well as allowing producers to pay to place content on the service...an example would be Hasbro placing a cartoon on Netflix to make money by selling merchandise.

As for Netflix, there has been discussion in the past about whether or not Netflix will eventually have to place advertising on its service, no matter what current management says. Hard to believe the company would ever do that (except for the aforementioned product placement and my Hasbro hypothetical example). More likely, it would create tiers like Hulu does now (maybe one tier is ad-supported, the other is not, and maybe there is a tier that is ad-supported and totally free but you don't get as much content, and/or you don't get an entire series all at once). Given that YouTube has made changes to its premium service (in the sense that original programming may migrate over to the ad-supported site at some point), I think we will see a significant evolution in how streaming services operate vis a vis advertising in the next few years.
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