Raja Jasti’s Blog - Renaissance Thinking

April 3, 2009

Hulu low on cash?

Filed under: Entertainment, Internet, Media — Tags: , — Raja @ 3:36 pm

Disney says Hulu is running low on cash.

Hulu_logo_2.jpg With all the rumors lately about Disney possibly cutting a deal with Hulu, various sources at Disney are talking to many on Wall Street about Hulu’s financial situation saying the company is getting low on cash. While Providence Equity Partners, who put $100M into Hulu two years ago, is saying Hulu is not having any finance problems, I tend to believe Disney. No company who is ever running low on cash says they are and their investors always tell you things are fine.

Hulu indeed may be running low on cash. It is expensive to run a video site. But it doesn’t mean they can’t raise more money. It also doesn’t mean its current owners, most notably News Corp and NBC Universal, won’t invest more money. I think Hulu is a great asset for their current owners in particular and hollywood in general to help them transition into the new media. If Hulu is shutdown no one will be happier than Google. Google then will eat hollywood’s lunch. Youtunbe, owned by Google, has Hulu envy. There is a good reason for that. Hollywood should get a clue from that. Disney is probably saying it to get a leverage in their negotiations with Hulu. That doesn’t mean that Hulu is in trouble.

March 31, 2009

Hulu snags Disney deal

Filed under: Entertainment, Internet, Media — Tags: , — Raja @ 10:26 am

This should give a huge boost to Hulu. Reports say that they have struck a deal with disney to bring it in as an equal partner with NBC Universal and New Corp. This deal would make Hulu the most powerful professional content player in the industry. This would be a blow to Youtube which tried to snare Disney at the eleventh hour, but only got a short form video deal.

A deal to bring Disney into the Hulu fold is “basically done,” a single source familiar with the discussions tells us.

PaidContent reported that if Disney were to do a deal, it would take a 30% stake in Hulu and become and equal partner to NBC Universal and News Corp. That means like NBC and News Corp before it, Disney would agree to spend $50 million marketing the site.

Providence Equity Partners will hang onto its 10% share.

March 30, 2009

Youtube wants to be more like Hulu

Filed under: Entertainment, Internet, Media — Tags: , , — Raja @ 9:06 am

According to reports, Youtube is planning a redesign of its website and player to highlight its professional content more prominently. It looks like Youtube has hulu envy.

YouTube will soon unveil a redesign that clearly separates its premium and long-form programming from the user-posted videos that account for most of its activity.

According to two sources familiar with Google’s plans for YouTube, the new design will do away with the current navigation scheme — which funnels users into “videos,” “channels,” and “community” categories. That layout will be replaced with a tabbed navigation with clearly defined sections for professional content.

The new design will offer four tabs: Movies, Music, Shows, and Videos. The first three tabs will display premium shows, clips, and movies from Google’s network and studio partners, all of which will be monetized with in-stream advertising. Meanwhile the Videos channel will house amateur and semi-pro content of the sort major brand advertisers have shied away from.

“They’re putting up walls between all the UGC stuff, which will live within the video channel,…and the brand safe content,” said one senior agency exec who was briefed on YouTube’s plans.

The redesign also touches YouTube’s video player. The new player interface closely resembles the video experience on Hulu, the News Corp.- and NBCU-owned video portal that’s grown by leaps and bounds since its launch last year. Like Hulu, the new video player displays visual markers in places where ads are scheduled to play. Also like Hulu, the YouTube player allows users to “dim the lights,” reducing the brightness of screen real estate outside the video frame.

“It’s totally a Hulu approach, but that’s best practices right now,” said the exec.

In a related news disney is in talks with youtube to license its content excluding it from hulu. If this deal materializes it would be a big win for youtube and a blow to hulu. It would also mean more fragmentation of professional video between hulu, tv.com and youtube.

The Walt Disney Company and Google (NSDQ: GOOG) are close to one programming deal for video portal YouTube, and are in discussions about another—also involving YouTube—that would preclude a deal with Hulu, paidContent has learned.

Disney (NYSE: DIS) and YouTube are in the final stages of negotiations to put clips from ESPN, ABC and other Disney assets on YouTube, according to sources familiar with the situation. The two companies would share revenue, with Disney controlling the ad inventory; YouTube and Google could get some inventory to sell. As important, YouTube would refer back to ESPN.com, ABC.com and the other Disney sites. Disney declined comment; a YouTube spokesman said the company does not comment on rumor or speculation.

In addition, the two are discussing a full-episode deal—a multi-year pay-for-play deal that would put ABC and some other Disney programming on YouTube instead of NBC Universal-News Corp (NYSE: NWS) joint venture Hulu. I am told these discussions have gone as high as Disney CEO Bob Iger and Google Chairman and CEO Eric Schmidt but that they are not as far along as the short-form deal—or as advanced as Disney’s negotiations with Hulu.

These two moves are probably related and shows youtube’s strategy revolves aroung copying hulu.

Update: PaidContent reports that Disney and Youtube deal is official for short form videos. Full episodic videos are still under discussion.

March 27, 2009

Disney to join Hulu?

Filed under: Entertainment, Internet, Media — Tags: , — Raja @ 8:32 am

Hulu, a joint venture between NBC Universal and New Corp, may add another media giant to its owneship. Paid Content, reports that Disney is in talks with Hulu on taking an equity stake in the company. If this happens Hulu will probably have access to all of disney owned content.

imageThe Walt Disney (NYSE: DIS) Company could wind up with an equity stake in Hulu in exchange for adding ABC programming to the NBC Universal-News Corp joint venture, a source familiar with the situation tells paidContent. It’s not clear how much of Disney’s television programming is involved beyond ABC—a second source says all Disney content has been discussed but it centers on ABC; other possibilities could include ESPN (not likely given ESPN’s reliance on license fees from cable operators and others) and, if not the Disney Channel, some offshoots. The discussions, dormant for a while, have picked up again recently and are described as “serious” by both sources. A third source close to the situation said the discussions with Disney are “definitely real”—and more so than before—but cautioned against saying any deal has been reached.

March 4, 2009

Disney entering VOD fray?

Filed under: Entertainment, Internet, Media, Trends — Tags: , , — Raja @ 9:38 am

Disney is mulling whether to offer their own subscription VOD service.

Bob Iger said Walt Disney Co is considering creating a subscription-based online movie and TV rental service from the company’s huge video library. It could be an online Disney video club that mails DVDs or downloads video files to members.

I see a trend where Hollywood studios and cable companies wanting to offer their own web video or VOD service. This is a natural tendency of wanting to control distribution. But web video is not about controlling distribution but about frictionless syndication. If I can all the movies from Netflix and all the TV content from Hulu why would I subscribe to Disney service?

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