Hulu is not dead to me
CNET has good interview with Eric Garland, the CEO of media measurement company Big Champagne, talking about file sharing and the future of film and television.
Most of his points aren’t new, but they’re delivered in less-hysterical terms than you often see.
The music people used to say, “How can you can compete with free?” And now you ask anybody in digital music and they’ll tell you, “I’m just trying to compete effectively with free.” They’ve embraced the very condition that up until very recently they said they would reject. I’m telling you, you are going to compete with free. Sometimes you’re even going to win, once you make the commitment to living in the marketplace as it is and not as you wish it were or as it once was.
Garland shares my sympathy for international viewers, who are often told to wait months for movies that the U.S. gets on day one. If you don’t give the audience a convenient and legal way to watch something, they’re going to find a convenient and illegal way. And it’s hard to blame them.
I have much less sympathy for users outraged that Hulu is going to start charging. “Hulu is dead to me” is the common refrain on messageboards and Twitter.
But here’s the thing: you don’t have a god-given right to free shows, just as you can’t walk into Barnes and Noble and start shoving books in your backpack. We’ve conflated the ideas of intellectual liberty and zero cost into a big bundle of entitlement.
While I disagree with many points in Chris Anderson’s Free
,
Right now, Hulu competes very effectively with free torrents on price. But if it chooses to move to a subscription model, it can ultimately offer more content at higher speeds, allowing it to compete better with free torrents on access.
Netflix is often seen as a tremendous bargain, offering a vast selection of movies and TV on demand for a low subscription price. That’s what Hulu may morph into, and that’s not cause for alarm.
Articles
October 28th, 2009 at 12:31 pm
I would gladly pay a reasonable price for Hulu if their service was available on an array of devices like Netflix streaming.
October 28th, 2009 at 12:36 pm
I think the problem is that Hulu is supposed to be paid for by advertisers and free to the viewer. Netflix is free from adverts but paid for by the viewer. Most people for whom Hulu is soon to be dead used Hulu, Tivo and torrents for watching something that was on TV (recently) at a time and place that suited them. If Hulu cannot support that market on ads alone, well that’s too bad.
October 28th, 2009 at 12:36 pm
I have to admit though…I appreciate the networks that let me watch last weeks episode of __________ without charging me for it. NBC charges for it’s shows, so if I miss the entire line-up on Thursday night, I have to pay to watch the shows. It seems kind of overkill to not let people watch something the broadcast and show online for free for at least a limited time.
(Hey, I have a 21″ monitor versus a 42″ inch hi-def TV…I’d prefer to watch TV shows on the TV.
October 28th, 2009 at 1:02 pm
People have always and will always pay for what they find valuable. All drug dealers know: the first bag is always free.
October 28th, 2009 at 1:08 pm
But Hulu is an ad based model. Albeit only one or maybe two sponsors per show. I got rid of my Uverse TV account and only use Hulu now (oh the joy of being unemployed!). If there was a minimal fee involved, but it meant I could get more content (with no ads??) I think I might cough up a few clams.
I always go to iTunes first and if I can’t find what I’m looking for, sniff around for other ways to get my mp3 fix (still need to figure out a way to get a UK account!).
I think the point raised about content needing to be available globally is spot on. There are so many shows and tunes (I hate that word) I want from the UK but can’t get legally here in the States.
Are we heading towards a global currency AND global legal digital media distribution??
October 28th, 2009 at 1:38 pm
Isn’t it funny how entitled we feel?
I hadn’t heard that (about Hulu charging) and immediately thought, “That is not fair.”
Well, it IS fair.
It’s not MY content to control.
I mean, I LIKE it being free… but I don’t have a right that it be free.
I thought the Barnes & Noble example was spot-on.
PS Do you think Hulu will offer a public option?
October 28th, 2009 at 1:39 pm
The problem is that there are several venues out there that are already charging for shows such as iTunes. As Jonathan and David says, it’s an ad based model. Remember these shows are shown for free on TV first (well, not free if you count the TV you bought and the cable subscription and the DVR).
The industry is paying attention to Hulu because it actually helps the ratings of certain TV shows such as Dollhouse. That number will drastically drop once it goes to a paid model. I guarantee that the numbers of watchers will drop to half. This will make the networks less likely to provide content to Hulu. So as a result, less content on Hulu.
October 28th, 2009 at 1:51 pm
Hulu faced an uphill battle even getting its core audience to visit the website in the first place, given its stigma as a Big Media endeavor. But the same people that criticized and mocked its very existence probably ended up using it more than any other group. Why? Because it worked well and offered tons of content. I’m sure they’ll be equally shrewd about rolling out the paid version. Again, they know in advance the arguments against it, and they’re no doubt aware that simply turning around and telling users to pay for the same material that was free yesterday won’t work as a business plan. The service will have to become bigger, better, and more versatile. Just like we expect different things from pay TV than we do from free TV, we’ll expect more from paid Hulu (and deservedly so).
October 28th, 2009 at 1:59 pm
Hulu was dead to me the moment they prevented me from using Hotspot shield. As I’m in Canada, I can’t watch it without it.
October 28th, 2009 at 2:06 pm
Agreed, John. Except offer that Barnes and Noble example to any of the Slashdot/Pirate-Bay-supporting crowd, and they’ll immediately throw back at you the argument that it costs something to print, ship, and display a book, but it doesn’t cost anything for a digital copy of a movie or TV show to be copied from place to place. They’ll argue that no finite resource is being removed, and therefore it’s not stealing. They’ll put “stealing” in quotes, too, to point out how silly you’re being. They’ll say it’s the content producers’ job to figure out how to make a profit in a market where they want and will indeed take everything they can for free. *
Of course their understanding of the issue doesn’t go so far as demonstrating that such behaviour will effectively mean the end of their content, period (or at least the kind of quality content they want). It basically goes only as far as not wanting to pay a couple bucks to watch Saw VI.
October 28th, 2009 at 2:07 pm
(Ah. Apparently WordPress turns my footnote asterisk into a bullet. Machines do far too much of my thinking for me. I wonder if they can get me a free copy of Saw VI.)
October 28th, 2009 at 2:22 pm
People complained when Facebook changed their front page feed. They blog about Google’s logo (And get upset if they don’t celebrate some obscure ‘holiday’). The Internet is fickle. But once the change happens they shut up and accept it. Hulu charging will be no different. I don’t pay for cable, but $10 a month for premium Hulu? My credit card is standing by.
We are accelerating toward a new world of content – Small (web), medium (tv), and large (theatrical). As Eric Garland pointed out, we got a free education from the music industry. Many in the entertainment industry continue to ignore it. But the time bomb started ticking long before the Act 1 break. Many refuse to see that suspicious box in the middle of the room with an LED timer counting down and updating its Twitter account. 10:00, 9:59, 9,58… Luckily, as we race toward the third act some amazing innovations are springing up (I’m ready for a Social TV ‘network’ and it’s not far off) that will make this easy and exciting for the general public.
As I wrote yesterday (http://tinyurl.com/yhj2omf) we are on the cusp of a major revolution in content creation and consumption. And the Vuguru deal (http://tinyurl.com/yz3kor7) is just the start of it. It’s nice to see people like John get the old and new ways. We need them to bridge the divide and make this all happen.
October 28th, 2009 at 2:39 pm
When Dr. Horrible came out it was free online, but could also be purchased on ITunes. I bought it because I didn’t want to deal with any hassle and because then I could watch it as many times as I wanted.
So people will pay for good material if they feel it’s worth it and the price is reasonable.
October 28th, 2009 at 2:58 pm
Microsoft competes with free. Does OK, I hear.
October 28th, 2009 at 3:19 pm
I can give Hulu my dollar.
Other things I have given my dollar to recently have given me… a broken iPhone app, a mild case of the flu, and an incredibly slim chance, at an extremely fluffy toy.
Hulu gave me interviews with Paul Greengrass where they talked about stuff like, you know… working with John August.
I can appreciate the latter. – And while I LOVE the rebel attitude that, “I have the right not to be advertised at.” — “You can either charge me for it… or you can advertise at me. – Not both.” – I have to say that, when you shout: “It should be either an ad-based model… or I should pay for it. Not both!”
You’re not eliminating a double standard… you’re creating one.
Speaking as a musician, I’m claiming that: You don’t have that attitude toward any other element of providence that comes out of Hollywood.
Does your paid/subscription TV have commercials?
When you buy a hip-hop cd do you really think they’re rhymin about drankin’ Cristal, drivin’ an Escelade, and rollin on Sumitomo tires because they want to?
What’s the last DVD you bought? – Does it have advertisements in it?
When you go to a bar that has a big neon Budweiser sign above it, don’t you think you should get your drinks for free? — How bout your internet service?
Of course not. – It would be idiocy in our current economic model to hold anyone else to that kind of (largely hypothetical) standard from the 80s.
My entire street is an ad-based model. 37 advertisements are visible from my window. — But I still pay to use it.
And I understand why we may all want to do it to the Star-Destroyers.
But why do it to the little guy?
October 28th, 2009 at 3:21 pm
I think that what worries a lot of people about Hulu is that it’s run by the studios. In the case of Netflix you have a service provider interested in making customers happy acting as an intermediary between the content providers and consumers. Because Hulu will have consumers dealing directly with the content providers, people are – rightfully – worried about the way that those providers will work with them. Big time folks like Sony don’t have a great track record here.
October 28th, 2009 at 4:15 pm
@Jiff Divingboard: Same thing happened to me. I first heard the news and I thought, “Well that’s stupid.” Then I actually gave it more than a moment’s thought and realized it’s not stupid at all.
The computer itself is the problem. People pay way too much for cable and completely forget about it, but moan and moan about paid content on the web.
On the one hand I suppose it’s because there haven’t been too many worthwhile places online that actually hold enough content and are stable enough to make paying seem worth your while. The iTunes Store has proved itself; if Hulu keeps building its content base at a rapid pace then I could see it becoming successful as a subscription-based model.
October 28th, 2009 at 5:00 pm
As long as Hulu doesn’t eliminate free programming (with ads) and doesn’t charge for programming with ads, I can agree that a pay model will work. I will never “subscribe” however. I will only pay per program and I won’t pay more than 75 cents for a single view. If I pay a dollar or more, I want to own it.
On another note, I will never understand why iTunes doesn’t add a free, advertiser supported download choice to its current model. iTunes could simply insert ads into the advertising breaks and the ads would rotate or be refreshed every time iTunes connected to the store. This could create an ongoing stream of revenue as “free” videos would generate income every time they are viewed. Just add a code to the players that disables fast forward during ad playback and you have the perfect model for the advertisers and those who love free media.
October 28th, 2009 at 5:01 pm
The studios should look at creating virtual theaters that screen films from their entire library… I’d buy that for a dollar!
There’s no reason an entire cinematic experience can’t be recreated online including cool things like peer ratings (I don’t go for no Rotten Tomatoes), after film ‘chats’ and such.
Then I would consider being a member/subscriber. But the way I view films now, I’d rather pay the iTunes way.
October 28th, 2009 at 5:34 pm
We’re witnessing the slow and painful restructuring of several industries that are all tied together in making a living from creating and delivering media. From newspapers to music, from movies to advertising, from entertainment electronics to telephone networks everything is changing. This is massive. It’s going to take time.
At least it seems that some sort of net neutrality has been agreed on. (See the amazing FCC ruling of Oct 22nd.) It means that competition in somewhat free and open markets may eventually have the last word in this epic battle between dinosaurs and pioneers, between yesterday and tomorrow.
Hulu is ahead of its time, but it doesn’t have the broad support of key players yet.
October 28th, 2009 at 8:27 pm
@David:
I haven’t seen anything that indicates whether paid Hulu will have ads or not. To be fair, we pay for cable and satellite channels that have ads everyday.
I too go to iTunes first, because it’s usually higher quality, and doesn’t rely on maintaining a connection.
@Jemaleddin:
For being run by studios, Hulu has been surprisingly great. And Netflix isn’t as autonomous as you might think. In order to provide “Watch Now” movies, they have to cut deals with studios, who could easily shut them out.
October 28th, 2009 at 8:48 pm
I shove books into my backpack at Barnes & Noble all the time. They don’t really seem to care. It’s super easy too. You should try it. And for DVDs, you can just cut open the box and take out the disc. Stealing things makes me feel like a big man.
October 28th, 2009 at 9:07 pm
Geez, very tough questions. I am not yet at the professional screenwriter point so I don’t care whether people pay to see my work, just that they see it at all.
I mean, youtube will always exist for those who need their quick video fix, but shouldn’t you pay something for Hulu and for the people who act and write and produce for a living?
Maybe not the executives, but we’re working on cutting out the middlemen here, right?
October 28th, 2009 at 9:08 pm
HBO.
’nuff said.
I will pay for something if it means I am getting quality in return.
October 28th, 2009 at 11:30 pm
I got rid of cable years ago. I rent movies, watch podcasts, and I watch broadcast TV – and Hulu. My first thought when they talked about charging (which is not a new idea) was “good luck with that.”
They may get it right. They may charge an appropriate price and a good enough product… or they may do what so many others have done and just try to repackage something people normally get for free for a price few are willing to pay.
There are a lot of models that might work. If they charge a very low price I’ll subscribe. I wouldn’t mind waiting to see something if they wanted to charge a higher price for the first week or two. I wouldn’t even care if they put ads in their offerings.
But they still have to compete with free for my precious time, and I gotta say this – there is way more great material out there than I have time to process. And it’s easy to get to. I don’t have to jump through hoops or anything.
October 29th, 2009 at 9:23 am
What Hulu doesn’t seem to get just yet is that it’s advantage is NOT quality, NOT ease-of-use, and NOT price. Like the giant music companies, it’s advantage is the back catalogue of niche stuff that a mass audience doesn’t care about, but in the long run makes a good profit.
October 29th, 2009 at 9:44 am
My gut reaction to Hulu-for-pay was this: I probably won’t sign up. It’s not that I think I’m entitled to television shows for free, which strikes me as a bit of a straw man, but that I simply don’t have the money for additional subscription services.
I was willing to pay for my shows with time spent watching commercials (and I’d watch more than one per break, if that’s what it took), like they did Back When, but I’m unable to spring for every service I want. Hulu’s a major part of my week (I don’t own a working television), but unless it’s startlingly cheap, I’ll probably stay with Netflix, whose DVD selection for now outclasses Hulu’s show selection.
If Hulu is cheap and commercial light (or free), maybe I’ll reconsider, just to catch the likes of THE OFFICE and 30 ROCK and THE DAILY SHOW while they’re still fresh… but my hesitation is based on my budget, not a sense of entitlement to free entertainment.
October 29th, 2009 at 10:00 am
This is an outrage! NBC is a rich corporation just like health insurance companies. They are only out for a profit! The actors in these shows are rich too! Tina Fey has millions, can’t she understand that us poor people want to laugh too? Why should only rich people who can afford the luxury of a pay service like Netflix or Hulu get to laugh? Why do these companies have to be so profit driven? Don’t they care about the little guy? Can’t the government provide a subsidy to help me pay for Hulu? Or better yet, can the government take over NBC they way they took over GM? Make the tax payers cover the cost of Hulu.
I want the government to pay for my new car (cash for clunkers) I want the government to pay for my college (pell grants) I want the governemnt to pay for my visit to the ER for a cough (healthcare reform) And I want the government to pay for my Hulu (The Office!)
Funny how when handouts and entitlements effect your pocketbook they’re bad but when translated into a real world issue, like healthcare, they’re compassionate. They both have the same affect, someone else is paying your way.
October 29th, 2009 at 10:43 am
I go to a place where they let me have free books, music and videos – it’s called the public library.
October 29th, 2009 at 12:00 pm
I don’t know what Hulu’s model will be, but the only problem I would possibly have with paying for it is that damned 8 day delay. If I’m paying for it, I’d like access at the same time people have access to it on television.
Otherwise, I’m kind of surprised they haven’t talked about it before now. My wife and I love Netflix, I feel my money is well spent in that model.
October 29th, 2009 at 12:02 pm
Um. Yeah, this is JUST like the healthcare debate.
October 29th, 2009 at 12:57 pm
We stopped paying for cable long ago. Too much money for too many channels we don’t watch. Offer us an a la carte option, and we’ll be glad to pony up the money for the six networks we want to watch. In the meantime, we have gotten MOST of the programming we want from Netflix and online sources like Hulu, iTunes, and Amazon. Again–we are glad to pay for the content we want to watch. It’s all the content we don’t watch that we don’t want to pay for.
We’ll be disappointed to see Hulu go to a pay model, as we were getting lots of good second-run content for free. (It’s not unfair–just unfortunate for us.) If they go to a model where we have to pay a general subscription cost, we’ll have to weigh the cost versus the selected content we get from them, just as we did with the cable company. If they’re smart, they’ll go a la carte by show. If not, well, we may just have to wait a little longer for those shows to hit Netflix, and hope the shows we’d like to watch in real time (Top Chef, Project Runway) continue to be available to purchase by the episode, or free in rerun online from their providers.
October 30th, 2009 at 2:03 am
Market forces are market forces, those who decide that they are unwilling to pay for a subscription based hulu are going to either watch less or find their shows/movies illegally. Hulu may end up to be more profitable switching to a subscription model, but the overwhelming likelihood is that unique viewership will shrink. It’s very much dependent on what Hulu deems is their goal: to curb pirating or make profits. In the short term, subscription will likely make more money, and clearly there isn’t too much brand loyalty yet with all the “Hulu is dead to me” talk. There are plenty of viable, commercial-free (though illegal) alternatives that people can and will take advantage of if Hulu becomes subscription based. The long term reality is, as the value of online advertising increases, the ad-supported model will end up garnering more unique viewers and likely be more valuable. The goal of a company is to make money, Hulu at some point had to start thinking about making profits and stop worrying about stopping piracy. It’s also important to keep in mind that the new generation, the one thats grown up with the internet, is the one that can most easily find a free alternative, and thats the market that Hulu should most be worried about chasing away. The best financial decision is hard to make from our perspective not knowing the numbers of it all.
October 30th, 2009 at 4:30 am
I disagree strongly with the suggestion in the post here that people who are upset about Hulu potentially charging a subscription fee somehow see themselves as having “a god-given right to free shows.” There is a difference between wanting continued free access to a site that you currently enjoy versus wanting all content to be free content. Advertising interrupting shows is hardly free, and a preference for this model does not makes one a free-content zealot.
There is also the implication by commenters here that everyone who objects to Hulu charing will run to Pirate Bay and download the shows for free from now on. Sure, they’ll be a few doing that. But I suspect those people are doing that anyway with Hulu as it is now.
The problem I have with this change is that Hulu’s current model fits well with my use of Hulu, i.e. quick catchup on shows or parts of shows I missed. I’m not going to pay a subscription for a service that I use occasionally to catch up on the last two minutes of Fringe that my DVR didn’t record. And how will I send a link to a friend to say, “hey, did you see this crazy moment on TV last night?” I suspect this use case is quite common to Hulu, and I fear that charging a subscription rate drives the bread-n-butter of Hulu’s business away and kills the service.
Also, I do believe that many of the people driving the move to charge for content on Hulu are choosing to be blind to the fact that people’s expectations for content on the web are different from content on TV, and yelling and screaming “but you pay for TV services” is not going to change people’s expectations. You could say I pay for my Internet service the way I pay for my cable service, and that has nothing to do with my expectations about what I should or should not pay for content.
Now if Hulu builds some +value service on top of it’s current service that is an additional charge beyond being able to watch and link to shows, that’s a different matter and might be useful. But most places I’ve seen this pending “charge for service” mentioned, it’s been a move to a subscription-based service as the primary means of delivering content on Hulu, which I think is a horrible idea.
October 30th, 2009 at 7:12 am
I’m still withholding a final decision until the particulars of a paid Hulu service are released, but chances are that I will stop using the service. I don’t mind paying for content, but I don’t use the service enough to justify a subscription to it. Currently I have 32 shows in my queue, and simply lack the time to watch them all. What would end up happening is I would go back to searching individual networks for the shows I like (most if not all have streaming shows available) and use iTunes for the ones I simply can’t live without. Hulu was always more of a convenience thing than a content thing for me. The sad part is that I most likely will miss out on some great debut shows that I watched on impulse and got hooked.
October 30th, 2009 at 7:48 am
Hulu has opened the door for many individuals who for example never saw the 1991 NBC prime time revival of the 60’s classic TV horror soap opera “Dark Shadows”. In reading hundreds of comments on Twitter, I was amazed how many vampire lovers never heard of “Dark Shadows” but now have seen the show thanks to Hulu and apparently that has created more of a hunger for it’s next reincarnation.
October 31st, 2009 at 2:32 am
@Gregg– Really? This is how you get your political talking points in? Well, no tax-payed health care benefits for you. Go take your hiked up premiums and move to another first world country where that system still occurs… Oh wait, there are none.
I’m sad that Hulu is talking about charging. On day one, it was a really great service with lots of shows, both old and new, available for 2 mins of ads. That’s a luxury. But then they added time delays, took away one or two episodes from a season but left the rest up (because now it’s definitely worth my time to buy the DVD boxset of Newsradio– cause I never ep. 18.) I have watched less and less of my TV (I don’t own a physical TV, btw) via Hulu so I can’t imagine it will be worth the price of subscription. I have been more and more enticed by Netflix, and when my finances are in better shape will consider them again.
November 1st, 2009 at 2:06 pm
As someone who works in the TV industry quite a lot, but is an indie DigiRebel at heart, I’m really torn on all of these fiscal viewing issues at the moment. I used to take the “Free” route when I was younger and poor, but as I have grown up and grabbed some cash, I’ve found that some things are very worth paying for. Mostly, it’s convenience (the true heart of all American spenders), sometimes it’s honor (I buy family packs of Mac OS!).
Ultimately, I think Hulu’s problem is a marketing one. People have proven they will drop money on things… like phone apps, netflix, etc. But Hulu was SO GREAT as a free service… to basically UNDO that… well, it’s going to sting. It’s going to force a lot of people to change their habits. And us American’s hate that.
That being said, only time will really tell. This could hurt Hulu, this could work swimmingly for them. The internet is a fickle bitch that way.
I will say that, if you want free network television… get some rabbit ears for your flatscreen TV or invest 50 bucks in an outdoor antenna. Man, the quality of over the air TV is AMAZING these days. And all free. I got me an EyeTV Hybrid, hooked up a computer to my projector, and bingo, free HD network TV with Tivo like recording capabilities.
November 3rd, 2009 at 1:17 pm
i would like to think that readers of john august’s blog, who is supercool in doing all he can to kick down knowledge to working and aspiring screenwriters alike, would notice the BEST THING ABOUT HULU… it gets MILLIONS of viewers to see obscure, INDIE films that normally had no promotion, advertising, or big studio distribution. sure, top network shows attract 40 million viewers a month… who, in turn, see a film like ‘Strictly Sexual’, in the movie section. shot for only 100k, this woody allen-ish relationship film is now a word-of-mouth hit. no marketing, no studio, just hulu saying ‘what the hell, lets put it up for free and see if people like it’…. they did. and for this, as an indie filmmaker, and more importantly, an indie film viewer, i am a HUGE hulu fan.
November 23rd, 2009 at 9:01 am
Hulu with more content, faster speeds and – most of all – available on devices I can easily plugin to the projector sounds like a great deal. I’d be happy to pay for that.
We don’t have cable and get all our TV and movie watching via Hulu, Netflix and the occasional torrent or iTunes store download.