The Upside to Hulu's 'Death Memo'
Hulu is contemplating some changes to its service, according to what has been described as a "death memo" that will "completely screw up Hulu" obtained by Variety's Andrew Wallenstein. Within this "confidential internal memo" are some possible modifications to the streaming video hub that will make it much worse, as a result of a buyout of part owner Providence Equity Partners. Fox wants more commercials, for example, increasing four ads per commercial pod on Hulu.com. And, both ABC and Fox say they won't give the site everything available on their own websites. More commercials + fewer shows = death memo. But, actually, due to the structure of the company, it's not as bad as it could be.
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There had been talk of turning Hulu into a TV everywhere service, rather than a standalone online place to watch TV, meaning one would have to have a cable subscription to watch Hulu's streams. That would change one of the few legal Internet TV watching places into a shackled Internet version of cable. Huge boo, from the perspective of users. But, it looks like all the infighting between the various owners has delayed that prospect, according to Wallenstein. "There's an interesting disparity in strategy between Disney and News Corp. on a key point: authentication. While News Corp. wants to continue to maintain its eight-day delay on programming availability to viewers who aren't subscribers to participating multichannel video providers, Disney declines to do so," he writes. It's this type of authentication that would cut Hulu off from people who don't have cable. News Corp, which owns Fox, wants a TV everywhere service. But it doesn't sound like Disney does. And because both have stakes in the company, all services need to sign on to get News Corp's wish.
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The other not so doomsday-ish part of the memo, is that viewers might see more content at other Internet destinations. Part of the new agreement includes a licensing deal for current season shows. So, News Corp and Disney can sell episodes to places like YouTube, for example. That, as Wallenstein points out, would dilute Hulu's "competitive advantage," but it would make stuff more available other places, which is good for you the viewer.
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Unlike Netflix, the people who own Hulu -- News Corp and Disney -- have competing traditional TV interests, which might save it from total destruction. If it were up to News Corp, for example, Hulu would be another HBO Go. Which, as we know, is not ideal for a lot of people.
