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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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RE: Who cares Mick
By crystal clear on 4/4/2010 4:29:13 AM , Rating: 0
I'm very sure that Dell would like to know how Apple is now out-selling them on servers, laptops, desktops, displays, etc.

Steve Jobs : Apple is a Mobile Device Company !
now a $50 Billion a year company !

With the combined platform of the iPhone and iPod touch. iPhone OS platform an installed base of over 75 million devices,add to this now the iPads.

Tim Cooks : "The reality is that the vast majority of Apple's revenue comes from either mobile devices or the content purchased for those mobile devices."

Even Apple's Mac business has become dominated by its portable MacBook and MacBook Pro notebooks.

(go to any major computer related event, you will see majority of the press are sporting Macbooks.)

As for Dell -

Apple in addition to having a operating system that is "hugely scalable" from servers and desktops down to pocketable devices, Apple also has hardware and industrial design chops.

Hard for Dell to compete (note in bold) in the future against such a company that has it all (as mentioned above)plus plenty of CASH in the warehouse waiting to be spent.

So in the future Dell will find itself loosing much of its marketshare in all the areas you mention.

Apple has an advantage in this space due to its experience in vertical integration. In addition to having a operating system that is "hugely scalable" from servers and desktops down to pocketable devices, Apple also has hardware and industrial design chops. "We believe that we are uniquely positioned to do extremely well in a mobile device world, because we have integrated together seamlessly software and hardware," Cook told the conference attendees. "There are very, very few companies in the world that can do that well." He said the traditional model of multiple vendors being responsible separately for hardware, OS, and key applications just doesn't work for mobile devices.

I can call you a fanboy.

NO ! not a fanboy but somebody who sees it very crystal clear (like my user name suggests) the facts on the ground (retail/marketplace)& future demand & trends.

You should be riding on the wave of success that Apple is currently riding on & make your big buck ! ( like I do ).

Instead of Applebashing you should writing Apps for Apple products & earn lots of money from it ( like I do ).

So crystal clear indeed.

Some one who knows how to analyse financial statemtents & financial outlooks of a company & see crystal clear their future.

As for Mick....well I bash him regularly on unresearched articles & more,but back him when I see crystal clear he is right on some aspects.

Have a nice day....nice discussing with you,instead of responding to some HOT headed Apple basher/s.

"So if you want to save the planet, feel free to drive your Hummer. Just avoid the drive thru line at McDonalds." -- Michael Asher

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