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19 March 2008

Hollywood Lobs Hulu Missile at Arrivistes

Hulu, the strongest response to date from Hollywood and the TV
networks’ to the relentless encroachments on their territory by pirates and upstarts like YouTube, debuted Wednesday with a selection of TV shows, movies and clips, and a promise to deliver the Web’s most comprehensive choice of free, premium entertainment content across all genres.

A joint venture of NBC Universal and News Corp, Hulu does not offer downloads but instead streams high-quality videos and throws in additional tools like full-screen view, a pop-out window and a ‘lower lights’ feature to enhance the viewing experience.

The richly funded startup also disclosed new partnerships with Warner Brothers Television Group, Lionsgate, NBA, NHL and a bunch of other content providers but two major networks Disney’s ABC and CBS are still missing from the list.

For the last few years, movie studios and the networks have been watching in distress as pirates and upstarts like Google’s YouTube gorge on their precious content without compensating them, and the free, ad-supported Hulu is the arrow they are shooting to slay the piracy beast.

Hulu has the money. In October last year, Hulu snagged $100 million in private equity investment from Providence Equity Partners, giving the startup enough moolah to sustain itself for the lengthy and daunting battle ahead.

“Today, Hulu is crossing a milestone in its mission to help people find and enjoy the world’s premium content, when, where and how they want it,” said Hulu CEO Jason Kilar. “With full-length episodes of current and archived television shows, feature films, sports and news, we believe the Hulu service is a step forward in giving consumers entertainment on their terms.”

We checked out some clips from one of our favorite movies “The Devil Wears Prada” on Hulu. Unlike on YouTube, we found the picture quality on Hulu pretty darn good.

At first, we picked the full screen option and watched Miranda Priestly (Meryl Streep) haul her assistant Andy Sachs (Anne Hathaway) over the coals on our 19-inch Acer LCD monitor and then popped out the video in a small box that we moved around on the screen. Hey, Hulu even offers a nifty feature that “lowers the lights” by graying out the background. Bet the picture will look even better on a 24-inch LCD monitor that we’re angling for. Hulu also lets users easily clip, share and embed videos on other Web sites, including blogs and social networking Web sites like Facebook or MySpace.

So if you enjoyed Chris Rock on Conan O’Brien’s show, you can quickly e-mail the link to your buddy in Austin or mom in Atlanta or zip it off to your Facebook or MySpace page. There’s a search feature that lets users find legal, premium video online even if it is not available on Hulu.com. Early reviews of Hulu from the experts have been positive.

The Wall Street Journal’s tech guru Walter Mossberg professes to be “very impressed with its design and ease of use, and with the fact that it allows users to edit and re-publish content on their own sites. Despite some drawbacks, it’s the first Web property I’ve seen from mainstream studios or networks that shows a real understanding of both modern Web design and the Internet’s culture of sharing. In my view, it’s far better than the typical network or studio Web site.”

Hulu’s biggest limitation right now is on the content side. The fledgling says its library offers 100 full-length movies, full-length episodes from over 250 TV series, and short clips from 150 more TV series and 50 additional movies.

Some of the TV shows you can expect to see on Hulu include current hits like “The Simpsons,” “The Office” and “Prison Break,” classics like “Arrested Development,” “Buffy the Vampire Slayer” and “Miami Vice.” Viewers can also see short clips from shows like “Saturday Night Live” and “In Living Color.”

For movie buffs, Hulu offers full-length feature films such as “The Big Lebowski,” “Me, Myself & Irene,” “Some Like It Hot,” “Mulholland Drive” and “Three Amigos!” as well as short clips from movies such as “Napoleon Dynamite,” “Little Miss Sunshine,” “Die Hard,” “Vertigo,” and “The Mummy.”

Hulu also expanded its content library with new additions that include shows like “Dirt,” “The Incredible Hulk,” “Babylon 5,” “Studio 60 on the Sunset Strip” and “The Dick Van Dyke Show,” movies like “The Usual Suspects” and “Ice Age,” nightly highlights, top plays and full-length games from the NBA and the NHL as well as made for web programming such as “Prom Queen” and “Onion News Network.”

However, compared with the cornucopia of content on YouTube or the
hundreds of pirate sites, Hulu arrives looking emaciated and with a limited arsenal of content. iTunes has a lot more videos but then consumers have to pay for all that stuff ($1.99 for an episode of a TV show). But NBC Universal’s content is not on iTunes after it failed to get Apple to allow it to try variable pricing. Nor is NBC Universal content on YouTube.

In October, NBCU ended its deal with YouTube and told YouTube to yank all NBC videos from its video-sharing site. In any case, how Hulu proposes to address the content shortcoming issue will be interesting to watch.

Other drawbacks include the inability to watch Hulu on a TV (like Amazon’s Unbox or iTunes) or the lack of a download feature for later viewing. Unlike us old fogies, the Gen Y crowd is used to watching programs on their PCs and laptops. Not an issue for them at all.

In beta since October with 60,000 users, Hulu has supposedly exceeded user expectations. Hulu executives say five million viewers have watched videos in the past 30 days on Hulu.com or on web sites of its distribution partners.

Besides the Hulu.com web site, the TV shows, movies and all the other content will also be available at Hulu’s five distribution partners’ Web sites like AOL, MSN, MySpace, Yahoo and Comcast’s Fancast.com.

The ads on Hulu are not a big put-off. Sometimes the ads were short (just five seconds), other times a bit longer (15 seconds) and on a few occasions they were long (25 seconds). In some instances, Hulu even lets you pick the advertisers. Given the pedigree of its backers, it’s not surprising that Hulu has launched with some marquee advertisers. Nissan, Best Buy, DirecTV, GM, Intel, State Farm, Chili’s, Wal-Mart, Priceline and Unilever are some of the well known brands that have signed up to peddle their wares on Hulu.

However Hulu enters an increasingly crowded arena. Besides YouTube and a gazillion pirate Web sites, there is competition from the upcoming venture of UK’s major television networks BBC Worldwide, ITV and Channel 4 that have banded together to use the Internet to deliver current and archived content from all three networks. The project is code named Kangaroo and is expected to launch in mid-2008 under a different name. A lot hangs on Hulu for News Corp and NBC and their film and TV units in stemming the tide of piracy.

And the big question of course is whether News Corp and NBC Universal can make decent money just off the ads and the distribution deals. It’s early days yet but stay tuned.