Why Hulu is clashing with potential partners

February 23, 2009

Two news items from last week are worth commenting on in the same post:

  1. Hulu insisted that Boxee pull its Hulu player from Boxee. For the un-nerdy, Boxee is the open-source media player software that I put on my Apple TV a few weeks back. Until last week, it allowed you to access Hulu online videos direct to the TV without the help of a PC. 

    The Boxee/Hulu experience is tremendously satisfying. Plus, it preserves all the advertising that Hulu needs to sustain itself. However, by making it super easy (some might say, convenient) to get online TV shows to the TV, Boxee is a threat to Hulu’s content partners, many of whom are still petrified about cannibalizing linear TV shows. So while those partners may be willing to support PC-based viewing, the moment Hulu is easily accessed on the TV, they get creeped out. Never mind that 5 million PCs in the US are currently connected to TVs for exactly this kind of experience — far more than AppleTV or Roku will ever have.
     

  2. Hulu pulled its content from syndication partner TV.com. TV.com is a CBS-owned TV fan site that previously focused on chat rooms and clips, but as of a month ago announced an online TV player strategy designed to monetize its 5 million viewers more effectively. The secret sauce was access to Hulu content (Fox + NBC) as well as CBS content, delivered through a player experience that was remarkably Huluesque.

    Design infringement aside, it’s hard not to see this one as an effort by Hulu to persuade CBS to allow CBS content to join the Hulu experience. If it’s not such an effort, it should be. Hulu is eager to allow syndication partners like Fancast and IMDB to succeed, but it doesn’t really want to enable CBS to have all the benefits of Hulu content without having signed up to be an official part of the system. Seems fair. Honestly, the only reason CBS wouldn’t want to do this is it would mean acknowledging that its costly and time-consuming solo syndication efforts were not enough. 

What’s going on here: Hulu is getting more and more powerful every day. And not just because it managed to get Alec Baldwin to promote it during the Super Bowl. It’s because Hulu gives people the thing they want most: easy access to top TV shows. But with great power comes great responsibility, at least in the mind of TV execs who suspect that Hulu will eventually erode their TV business (which has been steadily eroding anyway, not on an overall basis, but on a per-show basis).

With ad dollars tightening in a recession — across the board, mind you, not just in online video — TV execs who never liked the idea of online video in the first place are going to claw their way back into prominence inside their companies and start arguing for more restraint. We’ll see more removals of TV shows like The Mentalist, more announcements like that from SciFi about postponing Hulu streaming of  Battlestar Galactica until 8 days after broadcast.

All of this is part of something I call the coming online video backlash. It’s going to take this whole year, and it’s going to inspire a lot of hasty moves on the part of TV executives to pull previously available content. And consumers are going to hate it.

I don’t envy Hulu’s position in this. It has to keep the lines of access open to the providers of top TV content, but it has to make good on its promise of serving viewers. So far, it has done a great job, but at some point, it’s going to be forced to do something that will begin to tarnish its brand. I don’t personally think the Boxee removal qualifies — only a few tens of thousands of us are nerdy enough to have hacked our Apple TVs — but sometime soon, somebody at Viacom or Fox or Sony Pictures will recall content that was previously available. Expect it to happen around sweeps weeks or the season finale weeks. It’s gonna get ugly.

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Why Hulu’s Super Bowl ad is as smart as it is funny

February 4, 2009

I’ve been answering press questions about Super Bowl advertising for a decade or more, both as an analyst and as an academic (used to teach advertising management at Syracuse back in the good old 90s when your only way to watch Super Bowl ads was on TV or VCR). It seems that every year I’ve been involved the press stories say the same thing: Ads cost too much and aren’t as good as they used to be. 

Once in a while, an ad comes along that is brilliant. That brilliance is usually measured on the funny-meter, however. Rarely does it mean that a product has been properly promomted.

That’s what makes the “Huluwood” ad from Hulu featuring Alec Baldwin so brilliant. Not only is it funny, but it actually accomplishes a very subtle yet powerful marketing objective. Watch the commercial, have a few laughs, then read on.

Vodpod videos no longer available.

Why is this ad so good? Because it positions Hulu in exactly the right light. Instead of trying to say that Hulu is some kind of new service “unlike anything you’ve ever seen before,” this commercial makes it clear that Hulu is just TV, taken to the max. Which is exactly what people want. They don’t want Gemini Division, they don’t want LonelyGirl15. They want Lost and Family Guy and The Office. And they want it whenever and wherever they want. This is exactly what Hulu gives them and it’s the USP (unique selling proposition, sorry, I’m slipping back into professor mode, I can almost smell the classroom now) the ad delivers.

Personal riff: I absolutely love the new phase in Alec Baldwin’s career that this commercial epitomizes. From the guy who first interpreted Jack Ryan on the big screen in Hunt for Red October to this slightly hefty but immensely comedic persona that 30 Rock unleashed, I think he’s a million times more interesting now than he ever was in his movie star days. I don’t know how big a role Tina Fey had in bringing this out of him, but I assume she had a role because she is, after all, a genius.