The Wall Street Journal has an interesting article today in the Technology section regarding Hulu’s evolution over the past few years.
The article explains some of the strange decisions Hulu has been making recently (Hulu Plus, the addition of minutes of extra commercial interruptions, etc.). Apparently, there has been a lot of disagreement between ABC/FOX (major stakeholders in Hulu) and management at the online video site. Management wants to keep content free (with limited advertisement financing) and expand selection, while the broadcasters see online tv as stealing ad revenue and limiting the saleability of DVD and other reselling opportunities such as syndication.
As a person that cut the cable cord well over a year ago we have been heavy consumers of Hulu, which supplements our Netflix subscription, ESPN3 access, and over-the air network television. We have more tv than we can watch without the $60+ monthly bill. With a dedicated computer hooked to our TV via an HDMI cord we have all the benefits of a TV along with all the bells and whistles that the internet adds. Hulu management seems to understand what consumers like my family want…but the networks hate providing the content for free online.
They better get with the program. All of their content is already available in HD for free online with no commercial via Bit Torrent. If the content isn’t available online…or has too many commercials, then many people will just opt for to circumvent the networks and download the content for free.
It was sad to read that:
…at the end of June. News Corp. named Chase Carey to be its new president and chief operating officer. Mr. Carey had a very different vision for Hulu, according to people familiar with the matter. The former head of satellite operator DirecTV, Mr. Carey was a big believer in the subscription-TV business. He worried that online video would train a generation of people to expect entertainment for free with advertising. He thought Hulu should be supported by both subscriptions and ads, those people said. The strategy conflicted with Hulu’s initial business model.
Mr. Casey will kill Hulu if he is able to turn Hulu into a paid-subscription based service WITH commercials. What kind of idiot does he think we are? People that watch TV content online are savvy enough to know that paying for commercials when a free, high quality, and commercial-free option is one click…ONE CLICK…away. People don’t want to steal content, but they will if there is no sane legal way to obtain what they want.
The prior head of Netflix, Mr. Kilar, understood how to grow the business and keep the online consumer happy:
While Mr. Kilar had talked about adding subscriptions since Hulu’s launch, people close to him say he thought the best way to build the business was to increase the audience by keeping much of the content free, supported by advertising.
As long as the advertisements are limited and reasonable people will sit through them. Lately that has not been the case at Hulu. Commercial breaks are nearing 2 minutes in length 3-4 time per 30 minute episode…This is more interruption then over the air. I can record Community on my computers DVR and fast forward through all of the commercials or be forced to watch almost 8 minutes of advertisement on Hulu. No thank you.
I hope sanity prevails at Hulu. If it doesn’t I wont lose any sleep…there is a million other ways to watch tv. The TV networks better study what happened to the record industry.
