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Thursday, April 22, 2010, 05:30 am PT (08:30 am ET)

Hulu fears ABC iPad app could hurt its $9.95 subscription plans

Online streaming service Hulu is expected to introduce a $9.95-per-month subscription plan on May 24, but the company reportedly fears a free streaming application from ABC for the iPad could undermine its efforts.

The Los Angeles Times this week reported that Hulu plans to introduce a new service, dubbed Hulu Plus, that would give users access to a greater range of content. Customers would still be able to view the five most recent episodes of popular shows like "Lost" and Glee" for free, but subscribes would have access to a "more comprehensive selection," the report said.

Hulu also has plans to tie its subscription service in with a new iPad application. But according to Peter Kafka at MediaMemo, Hulu's iPad subscription aspirations could be devalued by a free streaming video application from ABC already available on the App Store.

Citing industry sources, Kafka said that Hulu CEO Jason Kilar "tried desperately to get ABC not to introduce its free app," because ABC giving away free content makes subscription-based access to Hulu on the iPad seem less valuable. ABC obviously did not place much weight behind Kilar's concerns, as the network's streaming application was available on the iPad from day one, and has found great success.

ABC's embrace of the iPad should come as no surprise, as the network is owned by Disney, of which Apple CEO Steve Jobs is the single-largest shareholder. In addition, after the iPad was announced, Disney Chief Executive Bob Iger called the iPad a "game changer" and said his company has big plans for interactive content on the device.

The Hulu subscription will reportedly only apply to shows from ABC, NBC and Fox. Cable networks like AMC and FX, Kafka said, will not offer content with the $9.95-a-month plan.

While current plans call for the most recent content on Hulu's website to remain free for viewers, previous reports have alleged that the iPad application will be a pay-only service.

Hulu could incentivize its subscription plan with Apple's iPad, and also offer a "window" where content is available to subscribers before it can be seen for free by the general public. According to the Times, it is Hulu's business partners that have pressured it into the subscription plans, "to both bolster revenue and train viewers to pay for online access to professionally produced content."