In order to support the free Hulu service, Hulu Plus was created at $9.95 a month but do to a slow start they have now cut the price in half.
The idea behind Hulu Plus was that subscribers would be able to pick from a larger selection of TV shows and movies than what the free service offers and have access to it from devices like the iPhone and iPad.
Since the service is not taking off as well as they would have liked, its now $4.95 a month, instead of $9.95.