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Jason Kilar, Hulu CEO  (Source: Patrick McElhenney/FX)
Pressure is mounting from content providers to make the switch to paid subscriptions

Hulu, a NBC Universal, News Corporation, and Walt Disney Company joint venture, has established itself as one of the most beloved video sites on the internet.  It practices a philosophy of quality over quantity, airing desirable content like television episodes from an elite group of content providers.  That means that while it may never have the net traffic of a free-for-all video site like YouTube, it has a much steadier audience and is arguably a more effective place to advertise.

Jason Kilar, Hulu's CEO, announced that the company has been profitable for two quarters now, as it enters its third year of existence.  Sources close to the company say that the company stands to make even bigger gains with the launch of the Apple iPad, for which Hulu is reportedly creating a custom app.

The company is not without some problems, though.  Hulu has 200 content suppliers, which received 50 to 70 percent of the advertising revenue from Hulu's video content.  Traffic has tripled over the last year to 903 million streams delivered in January.  Many content providers, however, are still complaining about their checks being too small.  They would prefer Hulu to adopt a subscription-fee based system.

Viacom was among the most frustrated, and it acted, pulling the plug on Hulu's rebroadcasted episodes of Comedy Central shows like “The Daily Show with Jon Stewart” and “The Colbert Report."

Still, Hulu pulled in $100M USD last year in ad revenue and could more than double that this year, according to Kilar.

Kilar reportedly is considering using the iPad as a test-bed for a subscription based service.  However, he seems wary of a user rebellion if he tries that.  He states, "Our mission is to help people discover the world’s premium content, and we believe that subscriptions can help to unlock some of that, including sports and movies and premium cable shows. We’re certainly open to subscriptions as a complement to an ad-supported model."

Another problem from Hulu is that it still hasn't delivered on its long-awaited iPhone app.  The app was expected in 2009, but never arrived; many are hoping it lands this year.

Despite these obstacles, Hulu seems unlikely to move out of the picture when it comes to internet video.  Its ability to become profitable without charging subscriptions is very impressive and hopefully content providers don't try to push to hard and mess up the good thing they started.

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Hulu on XBOX
By lightfoot on 4/2/2010 1:24:09 PM , Rating: 5
Hulu on the XBOX 360 would be huge. Should also be on the PS3 if it is not already.

RE: Hulu on XBOX
By RjBass on 4/2/2010 1:44:12 PM , Rating: 3
Agreed. We have turned our XBox into one of our main forms of entertainment in our living room and rarely use it for games anymore. Hulu on the XBox would be awesome.

RE: Hulu on XBOX
By SunAngel on 4/2/10, Rating: -1
RE: Hulu on XBOX
By lightfoot on 4/2/2010 2:34:38 PM , Rating: 4
More eyeballs on your content (and ads) results in more ad revenue. So long as the ad revenue outstrips the additional bandwidth cost it would be a net gain for everyone involved, including Hulu, the advertisers and the content providers.

RE: Hulu on XBOX
By damianrobertjones on 4/2/2010 3:49:07 PM , Rating: 2
As long as the ads don't divert to Russian malware pages.

RE: Hulu on XBOX
By Motoman on 4/2/2010 5:28:47 PM , Rating: 3 about Chinese malware pages?

RE: Hulu on XBOX
By amanojaku on 4/2/2010 3:45:15 PM , Rating: 4
Who said no one is paying for content? There's a payment mechanism that allows users to consume content for free, and it's been around for decades: advertising. Hulu has ads, and if it worked for the radio and TV it should work for sites like Hulu.

RE: Hulu on XBOX
By Granseth on 4/2/2010 4:40:05 PM , Rating: 3
It should actually work better on sites like Hulu since they can personalize the ads.

RE: Hulu on XBOX
By PrezWeezy on 4/2/2010 6:22:24 PM , Rating: 5
The same way channel 4, 5, 6 and 7 have become huge in TV. The user doesn't pay for it, Downy, and Clorox, and Chilies, and GE, and GM and Ford pay for it. How does Google make money? Ads are a viable way to profit. And as more people watch Hulu each ad space becomes more valuable because it reaches a bigger audience. The same way the Super Bowl ads are so expensive. Subscriptions are great, but Ads can support a lot too.

RE: Hulu on XBOX
By Modeverything on 4/2/2010 3:54:21 PM , Rating: 2
I use Playon to stream Hulu and many other channels on my Xbox and PS3. I've been using it for months and it's great.

RE: Hulu on XBOX
By blueboy09 on 4/3/2010 11:03:27 AM , Rating: 2
That's cool, but why pay for this app? Seems like it needs to be free. - BLUEBOY

RE: Hulu on XBOX
By Modeverything on 4/4/2010 5:05:45 PM , Rating: 2
Well, you do get it free if you do an $8 trial membership to Gamefly for one month. I don't mind paying a reasonable amount for good software though.

Loose cable, use hulu
By Iridium130m on 4/2/2010 2:09:16 PM , Rating: 5
I really hope they make it...I'm seriously considering dropping cable, as several of my friends already have, and using Hulu instead. Even if they went to a cost effective subscription model (say 5-10 bucks a month), it sure would beat my $60 a month portion of my cable bill I pay for tv and a bunch of channels I never watch.

RE: Loose cable, use hulu
By dayanth on 4/2/2010 6:20:54 PM , Rating: 2
I've been without cable since Hulu went live. And as for movies, if it's not on Hulu then I got it on Netflix.

So for $75/month, I get my internet connection and I can rent 3 DVDs at a time and watch streaming on Netflix. Then catch all my latest shows on Hulu when they're broadcasted, even if they are 8 days later. I usually miss the shows right when they used to air on TV, so now I just watch it online instead.

Even if Hulu did goto a subscription model, It still wouldn't hurt me as much as paying $130/month for internet and cable channels that are usually filled with 3-4 minutes worth of commercials anyways. The only reason for subscribing to cable I've heard is for the children's and education programming. So if you still want to pay for cable, then I would guess that would be the only reason to.

RE: Loose cable, use hulu
By seamonkey79 on 4/2/2010 6:59:39 PM , Rating: 3
3-4 minutes of commercials is old school, nowadays, many shows are at best 50 minutes of an hour, the majority of shows are 45 minutes of an hour, and some (like 24) are about 40 minutes of an hour.

RE: Loose cable, use hulu
By vol7ron on 4/2/2010 8:14:41 PM , Rating: 2
You beat me to it.

If he's getting only 3-4 mins of commercials on cable, then I idolize his local network. That is more like what Hulu is doing (6 or so commercials at 30secs for the hour). When a commercial comes on these days, I feel like I have time to eat a pizza, take a shower, and get back w/o missing anything. They have so many tv timeouts in sports these days, that it's like athletes don't need to be in shape anymore.

What would be nastier is if DVRs stored the marked commercial data and made users not be able to f/f through them -- I shutter at that thought.

RE: Loose cable, use hulu
By theapparition on 4/5/2010 1:36:34 PM , Rating: 3
What would be nastier is if DVRs stored the marked commercial data and made users not be able to f/f through them -- I shutter at that thought.

Start shuddering.
ReplayTV marketed thier DVR in the early days as having a feature that marked commercials and automatically skipped over them during playback, and they were subsequently sued into oblivion and never recovered.
Recently, Phillip patented the system where commercials could not be skipped over or fast forwarded through. Most cable companies have been in talks with Phillips about incorporating the technology into newer DVRs. Since the content producers have unanimously adopted it, the providers will have to support it or will not get to distribute the programming.

Add to that the DTCP "No copy" flag set to be turned on in 2012 for some broadcasts, and we have a recipe for control.

Welcome to progress.

RE: Loose cable, use hulu
By vol7ron on 9/30/2010 11:01:30 AM , Rating: 2
How much is XM/Sirius-TV?
Can't we just pay $10/mo more and go commercial free?

RE: Loose cable, use hulu
By AlexWade on 4/2/2010 9:10:43 PM , Rating: 2
The only reason I'm sticking with cable is my Hauppage HD PVR. It can record HDTV programs. Tonight, Lord of the Rings comes on TBS. This will hold me over until the extended version comes out on Blu-Ray. Older movies come on channels like HD Net and MGM HD. For such movies, you won't get a better quality on Blu-Ray, so this makes a great way to get some classics in a good quality. I record the program to the DVR just to be safe, and then I transfer it through the HD PVR. I'm recording LOTR right now.

The Hauppage HD PVR is great. It records in H.264, so I also bought the VideoReDo TV Suite, which makes frame-accurate cuts in H.264. This is great the games and movies with commercials I want to keep. If I want, I use the free multiAVCHD to make a Blu-Ray compatible movie on a DVD.

RE: Loose cable, use hulu
By johnsonx on 4/4/2010 3:11:15 AM , Rating: 2
I've been pay-tv free for 18 months, and generally pretty happy (I had been on DirecTV for 10 years). I have an antenna for the local TV channels, hooked to a dual-tuner HTPC. Combined with a netflix subscription, Hulu and the occaisional visit to RedBox, I have pretty much all the content I need.

I guess I won't mind too much if Hulu starts charging a SMALL fee, but only if that brings additional content. What I worry about though is if they start adding more unskippable commercials to the free service. The 30-second commercial breaks aren't too bad, and I actually do watch them. I'd really hate to go back to the bad old pre-DVR days where you had to sit through 5-minute blocks of commercials, or go find something else to do until the show came back on.

I rarely even see commercials on regular TV any more, as my HTPC skips them automatically. Yes, someone has to watch commercials or advertisers won't pay for all these shows I like any more. It just doesn't have to be me.

Who cares Mick
By bill4 on 4/3/2010 2:38:45 AM , Rating: 2
Stop hyping the iPad every single one of your 40,000 posts a day.

iPad will be DESTROYED in a few months by tablets running google chrome in my opinion. They will be 299 or less before long (no Apple tax) and have flash.

iPad is just a computer, why the hell would it cause more people to watch Hulu? You're so weird Mick. Just because it's from Apple you act like it's so amazing. News flash, Archos was doing touch internet tablets long before Apple. So I gues Apple copied Archos.

RE: Who cares Mick
By bill4 on 4/3/2010 2:42:49 AM , Rating: 2
LOL, look what Dailytech the Apple advertising company put under my post

"We don't know how to make a $500 computer that's not a piece of junk." -- Apple CEO Steve Jobs "

LOL, iPad starts at 499...

But anyways, I want an iPad, but hesitant to pull the trigger on two factors, price is a little high, and no flash. Guess what? Chrome touch tablets will solve both. And the last thing Apple is equipped for is a price war.

Go ahead and write your fake stories about how great the iPad is selling in the coming days Mick, like we know you will. Even if the numbers are bad you will spin them as good. But once Chrome tablets hit in a few months it's over.

RE: Who cares Mick
By crystal clear on 4/3/10, Rating: 0
RE: Who cares Mick
By oab on 4/3/2010 12:46:24 PM , Rating: 2
Keep that up and you'll have a heart attack.

RE: Who cares Mick
By MadMan007 on 4/3/2010 10:46:08 AM , Rating: 2
Too bad the iPad barely qualifies as a computer, certianly not a general purpose one. It's a CE device.

RE: Who cares Mick
By crystal clear on 4/3/10, Rating: -1
RE: Who cares Mick
By oab on 4/3/2010 12:51:16 PM , Rating: 2
Yes even when the iPhone was first launched, we had people forecasting its short life or instant death & now its a best seller.

More people thought it would be a success.

Consumer confidence in Apple products is sky high & that sells more than anything that competition will have to offer irrespective of the price & features.

I'm very sure that Dell would like to know how Apple is now out-selling them on servers, laptops, desktops, displays, etc.

Consumer confidence in Apple products is so high that you cannot call them fanboys/idiots etc rather a fact & reality of a successful product/s.

I can call you a fanboy.

As for Mick ...he is just reflecting consumer trends & the realities of the marketplace.

Clearly you have not seen the two years of Jason Mick's APPLE SECURITY HOLE MAKES INTERNET COLLAPSE INTO BLACK HOLE stories.

RE: Who cares Mick
By crystal clear on 4/4/10, Rating: 0
I use Hulu, but I hate it.
By DeathBooger on 4/2/2010 2:37:44 PM , Rating: 2
I hate Hulu. I hate having to watch the same 5 freaking commercials over and over again. The only reason I use it is because I'm lazy when it comes to TV and it's easier to watch everything on one site. I could just as easily watch the same damn shows on each network's site. There is no way I'm paying Hulu if they keep the commercials running. If that's the case, I'll just spend the $1.99 on iTunes for a commercial free episode.

By bighairycamel on 4/2/2010 4:42:08 PM , Rating: 3
From my experience, the ads on network sites are waaaay more obstructive. On top of that, some sites (like ABC last time I used it) don't allow you to view the content full-screen so you're forced to look at the banner and border ads.

I'll take the three 15-30 second commercials any day. Even if I DVRd the shows, it would take 30 secs to fast forward through the commercials. Besides, with tabbed browsing I dont even have to watch the commercials on Hulu.

Expecting anyone, anywhere, to give you commercial free subscription-less streaming content for free is completely unrealistic.

RE: I use Hulu, but I hate it.
By whiskerwill on 4/2/2010 5:23:42 PM , Rating: 3
I hate Hulu. I hate having to watch the same 5 freaking commercials over and over again. The only reason I use it is because I'm lazy when it comes to TV and it's easier to watch everything on one site.

If you're too lazy to even change channels on tv, hopefully you're too lazy to have sex and pass those genes onto another generation.

RE: I use Hulu, but I hate it.
By hiscross on 4/2/10, Rating: -1
RE: I use Hulu, but I hate it.
By DeathBooger on 4/3/10, Rating: -1
RE: I use Hulu, but I hate it.
By johnsonx on 4/4/2010 3:17:08 AM , Rating: 2
I certainly do not hate Hulu. However, I do agree, I do grow weary of seeing the same commercial each break. There literally have been cases where I saw the same exact commerical for all 5 breaks during a 1 hour show. I'd think with the level of success Hulu appears to have achieved, they'd have a larger pool of commercials to show.

By sapiens74 on 4/2/2010 6:35:26 PM , Rating: 2
Content providers always want to charge you as many times as they can.

By lainofthewired on 4/2/2010 7:16:39 PM , Rating: 2
"Many content providers, however, are still complaining about their checks being too small. They would prefer Hulu to adopt a subscription-fee based system."

And if they pull out? This is money that they wouldn't be now making. I mean, if they take their stuff off Hulu, people will go back to torrent or Youtube. I wonder if they don't see that...

By foolsgambit11 on 4/2/2010 11:40:17 PM , Rating: 2
I'm sure Viacom backed out as a bargaining chip to try to pressure Hulu into a subscription model. Either that, or they figure Hulu viewing is eating into their other revenue streams - people don't watch the Daily Show live (when they'd receive even more ad revenue) when they can watch it at their leisure on Hulu, or they don't buy DVD's of the shows, or they cancel their Viacom cable subscription because they can watch the shows they want online.

I wonder how many people would continue using Hulu if it went to a subscription model, though. I'm assuming they've run the numbers and figured that they'll make more off the few remaining customers than they do off their current (and expanding) customer base using ad revenue alone. On the other hand, if you're going to make people pay for something they used to get for free, Apple products seem to be the place to start - iTunes worked great for mp3s.

iPhone App or HTC EVO App?
By BruceLeet on 4/2/2010 7:34:37 PM , Rating: 2
Another problem from Hulu is that it still hasn't delivered on its long-awaited iPhone app. The app was expected in 2009, but never arrived; many are hoping it lands this year.

Maybe Hulu is waiting for HTC EVO to debut on the Sprint network?

The HTC EVO 4G simply crushes everything else on the market thanks to a 4.3" (480x800) TFT LCD, 1GHz Snapdragon processor, 512MB RAM, 8.0mp camera in addition to a 1.3mp front-facing camera for video conferencing, GPS, digital compass, stereo Bluetooth, Wi-Fi, mobile HDTV, and HDMI (720p) output.

By BruceLeet on 4/2/2010 7:44:26 PM , Rating: 2
Is it so that Hulu is holding out for HTC EVO / Sprint exclusivity much the way iPhone was exclusive to AT&T. I know it's apples to oranges but the key matter I've speculated here is exclusivity.

No, really?
By MrWho on 4/3/2010 8:48:54 AM , Rating: 2
"Many content providers, however, are still complaining about their checks being too small."

Why I am not surprised?

RE: No, really?
By Agent 86 on 4/5/2010 2:49:08 PM , Rating: 2
They should just use a larger piece of paper when they print the check then...

Money and greed
By DrApop on 4/5/2010 9:44:06 AM , Rating: 2
So the providers are already getting money from the ad revenue that Hulu is generating. Now they want subscriber fees on top of that. That is the problem with cable/Sat pay a fee to get the feed and have to endure advertising.

Now it is coming to Hulu.

By jimbojimbo on 4/5/2010 2:00:12 PM , Rating: 2
Hell, Apple fanboys believe wholeheartedly in paying extra to look cool so hell yeah they'd pay extra to stream Hulu. Now the only question is how do they show everyone at the coffee shop that they're streaming Hulu on their new iPad?

By MadMan007 on 4/2/2010 2:55:15 PM , Rating: 2
I take it Hulu already has something other than Flash set up to deliver content...otherwise lol@iPad.

Anyway using the iPad as a testbed doesn't mean that everyone will pay a subscription. Sheeple, and the early iPad consumer whores are more likely to be Apple zealots, are used to paying more for the same thing. How iPad early adopters would translate to a larger market is unknown but I'm guessing there will be more people just going straight to the content site if it becomes fee-only.

RE: Flash?
By bill4 on 4/3/10, Rating: -1
Apple to buy Intrinisity ?
By crystal clear on 4/3/2010 3:39:23 AM , Rating: 1

Thursday, April 1, 2010
Intrinsity Gets Sold: Did Apple Acquire The iPad's ARM Design Gold?

I suggested that Intrinsity (a privately owned ARM design house that's particularly well known for its low power static design techniques, and that also happens to be an EDN Innovation Award finalist in both the microprocessor and Innovator categories) might be the CPU core technology provider for the 'A4' microprocessor found in Apple's upcoming iPad tablet computer. Industry scuttlebutt also indicates that a notable percentage of the P.A. Semiconductor design team (including upper management), which Apple bought in late April 2008 in order to bring ARM-based semiconductor designs inside the company, have defected to start-ups and other companies. So it is that for the past few months I've been pondering whether Apple might be preparing to purchase Intrinisity, too.

Well, the pieces are falling into place. Solid rumor has it that Intrinsity has been sold, and that the buyer's identity will become public in the next day or two. Keep in mind that it's Thursday afternoon, and that the iPad is due to go on sale in about 36 hours' time.

As soon as that happens, software developers' NDAs will likely also expire, and at that point we'll know for sure the source of the iPad's CPU...which again, I strongly suspect, is Intrinsity in conjunction with its silicon integration and foundry partner, Samsung.

So an acquisition announcement coincident with the iPad rollout makes a lot of sense, particularly if (as expected) Apple's plans for the A4 extend beyond the iPad.

And the fact that Intrinsity's website home page is currently 'under construction' further thickens the plot. Expect something, I suspect, after close of market Friday.

Stay tuned as I dig for more details on this breaking story. And no, it's not an April Fool's joke...

By crystal clear on 4/4/2010 5:19:25 AM , Rating: 1
Hulu, a NBC Universal, News Corporation, and Walt Disney Company joint venture

After 2 profitble quarters in recessionary times means it has to build on this to ensure revenues & profits flow in every more.

They want to be riding on the wave of success that Apple is currently riding on & make their big buck !.

"Money never starts an idea; it is the idea that starts the money."

So its a great idea to have it on & paid contents.

Lets the revenues flow in even more !

Wish the U.S. economy will take off like Apple....creating more jobs (not Steve Jobs).

Good luck !

The iPad dissected !
By crystal clear on 4/3/10, Rating: 0
RE: The iPad dissected !
By crystal clear on 4/3/10, Rating: 0
“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads

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