Raja Jasti’s Blog - Renaissance Thinking

Hulu is one of my favorites websites. But its future seems to be getting more challenging. BW has an article on the challenges ahead for Hulu.

In the Super Bowl commercial calling Hulu “an evil plot to destroy the world,” 30 Rock star Alec Baldwin intones: “There’s nothing you can do to stop it.” He’s right that viewers can’t get enough of the joint venture from NBC Universal (GE) and News Corp. (NWS). In February it had the biggest surge in unique viewers of any online video site in that period, according to comScore (SCOR).

Even Disney (DIS), a media company that has restricted most of its television and film content to its own sites, is negotiating to put videos on Hulu in exchange for an equity stake in the joint venture, according to a source with knowledge of the deal.

But Hulu is facing plenty of roadblocks elsewhere, including among advertisers, partners that provide entertainment content, and even its parent companies concerned that the site might cannibalize their own competing media. Under pressure from content providers, Hulu has gone back on its pledge to allow anyone to syndicate its content anywhere on the Web. At least one analyst says the site is struggling to find ads for many of its videos. And a lengthening list of rivals is rushing to move content online, spurred by the success of Hulu and online video leader YouTube, owned by Google (GOOG).

To News Corp., NBC, and other media companies pinning their hopes on Web video, the speed bumps keep alive concerns over the ability to offset diminished demand for broadcast advertising with revenue from Internet programming.

Analysts are already revisiting their forecasts for ad spending on Hulu and other online video sites this year. In November, Screen Digest’s Arash Amel predicted Hulu would generate $180 million in advertising this year, matching or surpassing YouTube. London-based Amel still expects Hulu to give YouTube a run for its money, but he now thinks each will take in only around $120 million in 2009.

Just as the music industry, hollywood needs to have patience in nuturing an innovative ecosytem to succeffully transistion into the digital future. If they somehone screw up and kill Hulu, the most innovative professional video site out there, they are doing themselves a great disservice.

NewTeeVee has a post about the potential dangers lurking for the professional video content sites such as Hulu.

The music industry isn’t the only one getting ready to kill off its young. Networks have increasingly been removing content from Hulu.com and their own web sites. It’s Always Sunny in Philadelphia episodes disappeared in January from Hulu, and shows like The Mentalist and Big Bang Theory were removed without warning from the CBS web site last fall. Finally, there’s the continuing spat between Hulu and Boxee, with rights holders pulling the strings to block any attempt to watch their content on TV-connected devices.

And things are gonna get worse, thanks to the fear of losing ad revenue in times of declining ad budgets, according to Forrester analyst JamesMcQuivey. “We expect this situation to intensify throughout the first half of 2009, resulting in bolder content restrictions on the part of content owners and more doubt cast on the role of online TV show aggregators,” he writes in a new report titled “Preparing For The Coming Online TV Backlash” that Forrester is sharing freely with registered users.

McQuivey isn’t the only one pessimistic about big media’s response to the recession. Liz noted on Friday that Hulu risks losing support from NBC and Fox, and another report just suggested that “Online video (is) not commercially viable.”

In fact, platforms like Hulu could soon find themselves in a situation similar to their musical counterparts Imeem and Last.fm. Hulu has shown some phenomenal growth, just like streaming music platforms, but all those public service ads we’ve been seeing lately seem to suggest that their ad inventory isn’t keeping up with that. Which means we could very well see Hulu and its online competition left in the cold while big media retrenches to oldteevee.

NYT chimes in on the viability of free model for professional onlint content.

MILWAUKEE — In the last couple of years, the television industry has made a big push onto the Web, giving viewers hope that they might one day reach nirvana: every show ever made, available online for immediate free viewing.

But many in the industry are now questioning whether free is a sustainable model. And some are trying to make sure people have a reason to keep paying hefty cable bills.

Time Warner Cable, the second-largest cable operator in the country, is working with customers here to test a subscriber model for online TV viewing. Residents who pay for HBO can watch “Big Love,” “Entourage” and other programs on their computers, using special software and a personal log-in. People who are not HBO subscribers are barred from the service.