Hulu's CEO explains why TV networks should sell shows to him and not Netflix

On Tuesday at Business Insider's Ignition conference, Hulu CEO Mike Hopkins took an indirect shot at Netflix by saying Hulu had a more "network-friendly" approach to acquiring shows than its competitors.

But what does that mean?

Promoting networks

The first element Hopkins pointed to was Hulu's "promotion" of the original networks, especially when current episodes of the show are still being aired. This probably means things like leaving the original network's logo on the show, which seems to be Hulu's policy.

Netflix, in contrast, usually strips its reruns of the original network's branding. An exception to this is ABC's hit show "How to Get Away with Murder," which runs on Netflix with a tiny "ABC" overlay in the Netflix menu, as well as a few-second promo at the start of each episode that also features the "ABC" logo. This was reportedly the result of the network playing a little hardball with Netflix on this issue.

When Hopkins says Hulu is more "network-friendly," the implication is that Netflix's policies hurt networks by cleaving their brand from the hit shows they produce.

Dealing with ads

The second element where Hopkins said Hulu differentiates itself is in training customers to deal with ads. While Hulu does offer an "ad-free" option (which isn't completely ad-free anyway), Hopkins said his service gets people used to the choice of either paying a small monthly fee and ads, or a larger monthly fee without ads.

"If you want it without ads, you have to pay more," he said. This stands in opposition to Netflix, which has no ad-supported tier. The thinking is that when customers get used to an ad-free experience, every ad starts to bug them. And the implication from this is that Netflix's basic model erodes traditional cable's ability to sell ads by creating a viewership that sees ads as an imposition.

Hopkins rounded out this answer by saying that he is positioning Hulu, generally, as a "better" place for networks to sell content. This makes sense given that Hulu is owned jointly by Disney, Comcast, and Fox - and potentially soon Time Warner.

But one person who probably doesn't agree with Hopkins is Netflix CEO Reed Hastings. Hastings has said that Hulu is a "cord-cutter's dream" and "much more disruptive" to traditional TV than Netflix. Hopkins likely believes the opposite.