Hulu has been offering on-demand programming from major networks similar to the offerings of Netflix. However, according to a report by the Wall Street Journal, the company is now looking to move beyond providing users with replays of shows.

The report claims that Hulu is developing a subscription service that would stream feeds live from popular channels, citing sources familiar with the company's plans. The Internet TV product will work similarly to Dish's Sling TV and Sony's PlayStation Vue, and is being targeted to launch early next year.

Working on the project with Hulu are Walt Disney Co. and 21st Century Fox, which are co-owners of the streaming service. The entertainment giants are close to inking agreements that would license many of their channels for the new platform.

The unannounced service will allow users to watch live streams of a variety of popular channels that include Fox, the Disney Channel, ABC, FX and ESPN, while also including DVR-style functionality to allow users to record and then watch programs at their own time.

The service will cost about $40 a month, and customers do not need to have a Hulu subscription to avail it.

The new platform could be a game changer as Walt Disney and 21st Century Fox are now looking to sell a service that would directly compete with the pay TV providers that make up the bulk of the clients they sell their content to. Users who would like to watch shows provided by these two companies will no longer have to sign up for a traditional pay TV subscription, as they would be able to watch the programs through the new Hulu offering.

Traditional pay TV providers such as Comcast would certainly not appreciate the new service despite the high possibility that Hulu says it will target customers who have already decided to be cord cutters and end their pay TV subscriptions.

That will not derail plans for the new Hulu offering though, with Walt Disney and 21st Century Fox set to compete with their own customers for subscription dollars from consumers.