Hulu and the Continuing Evolution of the Internet Bussiness Model

For those few who don't know, Hulu is a streaming-video service by NBC Universal and News Corp. It provides, free of charge, streaming video of popular television series and some movies. Shows like Terminator: The Sarah Connor Chronicles, House, Heroes, and Sons of Anarchy are among those available. There's a good number of movies also, and a good selection of anime. The service is ad-supported, so you'll have to suffer through commercials just like good, old-fashioned television.

Hulu even allows for embedded video, like this:



What I find interesting is how Hulu constantly updates, removes, and adds media. A given television episode my spend only a month on Hulu, starting a week or so after its original air date. Television shows have a life cycle, it seems: it starts with the original broadcast showing, and then makes a hop to iTunes or some other pay$ download service, and then it may jump to Hulu for a while, before making it to DVD.

In theory, Hulu and its kin should work to combat piracy. The idea is that folks will watch Hulu, with its ad-supported video, rather than use torrent sites. Of course, that's only theory. In practice, however, it seems to me that the powers-that-be are missing the point. The current model leaves 8 days or more between the original air date and the Hulu launch, so if one misses an episode, one can't catch up (without the aid of torrenting sites). Taking down the videos after a given time also runs the same risk. For example, if you missed the first two seasons of Heroes, your can't catch up on Hulu.

So how does it fit together? For me, the studios are missing the point and costing themselves money. I don't have cable and broadcast is a joke, and paying for stuff on iTunes is silly. That leaves free, ad-supported services like Hulu and DVD.

For some shows, the DVD is a foregone conclusion - Futrama, Battlestar Galactica, Sons of Anarchy - but for others . . .not so much (I'm looking at you, The Shield, Weeds). It's not that they are bad shows, but rather that the cost of the DVD is simply not worth the entertainment from the series.

The bottom line seems to be the same as with movie piracy: if you make a good movie, people will buy the DVD/Blu-ray (or, if you make a medicore movie like The Dark Knight . . .). For the less-great shows, the studios are loosing money and screwing themselves by not putting the stuff on Hulu for free. Hell, I watched Jackass 2.5 (well, 30 minutes of it, anyway) on Hulu, sitting through 3 commercials. That's three ad impressions that the studio would not have gotten without Hulu. I would never buy Jackass, but thanks to Hulu, the studios will get a little bit more than they had before.

Also: South Park Studios. That's the right way to do it. Every episode, online, free.