Image source: Hulu.

Has the moment cord-cutters waited for finally arrived? The Wall Street Journal (subscription required) reported over the weekend that Hulu, a joint venture from The Walt Disney Company (NYSE:DIS), NBCUniversal, and 21st Century Fox (NASDAQ:FOXA), is planning to offer live-streaming of television shows. Hulu currently offers both ad-supported content and a subscription-based, commercial-free model. Hulu on Wednesday confirmed it plans next year to offer subscribers the ability to stream "live programming from broadcast and cable brands," according to The Verge.

Hulu has always offered day-after, on-demand access to television shows, so adding a live-streaming function would be a massive change to the service's value proposition. The Journal said Hulu's live-streaming delivery from programmers ESPN, ABC, Fox, and FX would cost in the ballpark of $40 a month, versus the current service cost of as low as $7.99 monthly. If it succeeds, it could be one of the best skinny-package offerings and a direct threat to cable companies. That is if Hulu's owners commit to the new service, and that's not entirely clear.

A win for content at the expense of delivery
Television has two components: content and delivery. Programmers, like the ones mentioned here, produce content. These have traditionally relied on multichannel video programming distributors, or MVPDs, to deliver this content and collect payment for the services. Delivery methods continue to evolve, from land-line cable (Time Warner Cable and Comcast (NASDAQ:CMCSA)) to direct-broadcast satellite (DirecTV and DISH Network) to fiber-optic delivery (Verizon's FiOS).

As much as the method of live-television delivery, what had historically not changed is that delivery and content has been conducted by two separate entities. (More on this later.) A few years ago, this started to change, with Time Warner's HBO among the highest-profile channels to go direct-to-consumer with its HBO Now program. Other networks that offer a streaming-based service are CBS All Access and Showtime.

Still, none of these services could be considered a traditional-TV replacement. For starters, many of these streaming-based offerings are for a single network's content, meaning a cord-cutter would have to endure the laborious process of creating logins for every network. Second, companies with multiple-network catalogs, such as Hulu (currently) and Netflix, don't have live-streaming delivery. Third, with CBS's All-Access coming in at $6 per month, one of the cheaper direct-to-consumer offerings, it's cost-prohibitive for cord-cutters to subscribe to multiple streaming services.

It's likely NBCUniversal doesn't want Hulu to live-stream
Of these three issues, two are remedied by a live-streaming Hulu, as the new service has multiple network catalogs with the simplicity of one login. Per The Wall Street Journal, networks owned by Disney (ESPN, Disney, and ABC) and Fox (Fox, FX, and Fox News) would be available for live-streaming delivery for Hulu's live-streaming service. On the other hand, NBCUniversal's networks, including USA Network, Bravo, and E!, reportedly haven't agreed to this deal.

It doesn't take a business genius to understand why NBCUniversal would be less enamored with the idea of creating a direct-to-consumer option that cuts MVPDs out of the monetization chain. Most likely it's because NBCUniversal is owned by MVPD giant Comcast.

Hulu is interesting because two of the joint owners are purely in the programming business, where the goal is to monetize content in the most effective manner possible. As more consumers shift to smaller pay-TV packages and even cut the cord in favor of Internet-only service, it makes sense for these programmers to offer a streaming-based service. On the other, delivery companies such as Comcast have a vested interest in not having content delivered outside the traditional MVPD service.

A Comcast TV customer that cuts pay-TV service to go Hulu-only costs the company revenue. If Comcast feels live-streaming Hulu is a threat to the company's MVPD delivery model, it's likely to continue to withhold live-streaming programming from the new service. But for cord-cutters looking to access content, Hulu could introduce a compelling option -- even without NBCUniversal's live-streaming catalog.