Hulu Moving to Subscription Model Next Year

Well, the rumors were true. NBC/Universal just couldn’t stand watching those imaginary dollars slide on by, so they plan on charging for a service that has been free since it’s inception. It is sure to be a move that will annoy many, and probably nudge them to start looking for alternatives (legal or not). The deal:

“It’s time to start getting paid for broadcast content online,” he said. Carey said that while everyone cites the infamous Jeff Zucker quip that “We’re exchanging analogue dollars for digital dimes,” the industry continues to do exactly that. The strategy needs to be more than just fighting piracy and Google, he says.“I think a free model is a very difficult way to capture the value of our content. I think what we need to do is deliver that content to consumers in a way where they will appreciate the value,” Carey said. “Hulu concurs with that, it needs to evolve to have a meaningful subscription model as part of its business.”

AdVerse had a quick chat with Carey too and posed the question, when exactly does Hulu start charging then? Carey, who says he’s only been to one Hulu board meeting since arriving at News Corp., suggests there is still no timeline but supposes it’s at least in 2010. Carey says that while throwing up a pay-wall around all content is not the answer, it doesn’t mean there wont be fees for some specially-created content and TV previews. Windows are just around the corner. American Idol audition previews anyone? Mobile Hulu is another potential way of making money.

Aren’t the ads supposed to be there for this reason? I’d wager that with Hulu around people are appreciating the value of the content by not pirating it.

Still, a subscription model does seem inevitable as more content shifts towards being showcased online. We’ll be waiting for pricing and structure announcements next year. Read the full article at B&C: Chase Carey: Hulu to Charge in 2010.

It Isn’t All Gravy for Some VOD Start Ups

Despite advances in technology and viewers, many VOD initiatives have been shutting down. It seems only natural, given the glut already out there considering how young the format is (in viewers’ eyes). Ripe Digital Entertainment is the latest on the list of casualties. There’s an interesting write up over at PaidContent reflecting on the VOD closures:

It wasn’t that long ago when Disney, HBO, NBC and AOL started funding these projects, with flashy announcements and high-profile backers. Now, as the bubble on original online video has burst, most of these efforts have been stalled, and network-backed options such as Hulu have taken off, LAT surveys the scenario and trends going ahead:—In Feb last year, Disney launched Stage 9 Digital with an initial roster of about 20 shows. With the exception of its first series, “Squeegees,” a comedy about window washers, none of the others saw the light of the day. Earlier this year, it laid off most of its staff, and in March Stage 9 was shut down.

—Turner’s online comedy venture SuperDeluxe, launched in 2007 as edgy, multiplatform brand aimed at men 18-24, folded last year into its much more recognizable AdultSwim brand.

—HBO and AOL’s comedy venture ThisJustIn folded due to, well, pure and simple mismanagement, besides the macro issues. Then we all know siste[r] company Time Inc’s doomed venture with OfficePirates: that closed down two years ago.

—Besides big media, startups like 60Frames and ManiaTV have also closed down in the last year. Some of these moved away from creating original content but served as distributors, but even then, ad dollars didn’t grow fast enough to cover production costs, let alone overhead, as LAT story explains.

—Just yesterday, CBS-backed EQAL announced that it is moving away from development and funding of its own standalone series, in favor of running the online video properties for existing brands like CBS’ Harpers Island (called Harper’s Globe) or Food Network icon Paula Deen.

The reasons for the above failures came down to hubris, the hope that advertising would help tide the way. With the economy, and general lack of a big enough audience to monetize, most of the optimism has frittered away.

Still, it seems that nobody out there really has the answer. Check out the full article over at PC.

Rumor: Subscription Model Coming to Hulu

There’s rumblings of a new pricing structure coming to Hulu, which is sure to disappoint many of the fans who appreciate the free service. Here’s the beef:

Speaking last night at an Internet Week event sponsored by The Hollywood Reporter, Jonathan Miller, News Corp.’s newly-installed chief digital officer, said he envisions a future where at least some of the TV shows and movies on Hulu, the premium video site co-owned by News Corp., NBC Universal and Disney, are available only to subscribers.

Miller, whose last job was running AOL (parent of Daily Finance), prefaced his remark by noting that he won’t attend his first Hulu board meeting until Monday, so the scenario he foresees is merely his own speculation. But, he continued, “in my opinion the answer could be yes. I don’t see why over time that shouldn’t happen. I don’t think it’s on the agenda for Monday [but] it seems to me that over time that could be a logical thing.”

Sounds reasonable, given the stake that the parent companies have in Hulu. In the mean time, just keep watching. Thanks DailyFinance.

Independent Distributors Closing the Gap Between DVD and Blu-ray

A handful of independent distriubtion companies, including The Criterion Collection, First Look Studios, Cinevolve, and E1 Entertainment are debuting Blu-ray titles at the same (or within $1 of) their DVD counterparts in an effort to close the price gap between the two formats. Check this out:

Although consumers and retailers have expressed interest in seeing the pricing gap disappear, the major studios so far have only used equal or near-equal pricing for DVD and Blu-ray on a handful of titles. New movies frequently carry Blu-ray list prices of $34.99 to $39.99, and the high-definition version is usually priced $5 to $10 above the standard DVD version of the same title.

In June, E1 will release two films on DVD and Blu-ray, thriller Elsewhere (June 2) and Heather Graham-starring comedy Baby on Board (June 9), each at a $24.95 price point on either format.

[...]

Cinevolve is releasing some films on Blu-ray at $24.95, including upcoming releases of comedySisterhood (May 19) and filmmaker Jim Killeen’s documentary Google Me (July 21). However, the Blu-ray prices are still at a premium over the company’s standard DVDs. Sisterhood is priced at $22.95 on DVD, for example.

[...]

Treston is forging ahead with Blu-ray even though he doesn’t expect the format to last nearly as long as standard DVD has. Cinevolve also is working on digital download efforts. “We want to be as future-ready as we can be,” he said.

Yet Treston encourages other independents to get into Blu-ray to keep production costs down. “With more on board, it will lower the cost,” he said.

With Blu-ray prices falling, there are surely more shoppers out there ready to make the leap to compliment their new HDTV purchases. It is good news for Blu-ray, as the price premium for the optical disc has been the biggest obstacle for the new format to break into the majority market. (We’re still waiting for VOD to take over completely, but that will come in due time).

Full article here.

Blu-ray Players with Amazon Video On Demand Hitting Stores

The first line of upgraded Blu-ray players from the houses of Panasonic and Samsung are coming packed with a new feature: wireless steaming capabilities for Amazon’s Video On Demand service. The new players will sport the functionality in June, no firmware updates required. Dig it:

Panasonic and Samsung are among manufacturers hoping their players now hitting stores will capture consumer attention with their stepped-up capabilities. Panasonic’s $299 DMP-BD60 and $399 DMP-BD80 will stream Amazon content this June, with no firmware updates required. The company also is selling the industry’s first dual VHS and Blu-ray player, the $399 DMP-BD70.  Plus, Samsung’s $299 BD-P1600 introduces wireless Web access for a set-top.

Despite the advance in tech, the manufacturers (and retailers) are still feeling the pain of the weak economy. Many of them don’t believe the advent of new features will be enough to stir up shopping activity. In fact, many analysts are calling for price drops on Blu-ray players to entice new HDTV owners to jump into the large capacity disc format.

For more info, check out the full article over at VidBiz.

YouTube Teams Up with Universal Music for VEVO

VEVO LAS VEGAS! Oh, right…YouTube has announced their partnership with Universal Music Group for VEVO – a “music and video entertainment hub” that features high quality Universal Music content. From the ‘Tube:

This service will blend UMG’s broad catalog of artists and content production capabilities with our video technology and user community — in other words, we’ll provide the technology infrastructure that will power VEVO and host UMG’s extensive library of professionally-created music videos on the new site. This content will be exclusively available through VEVO.com and a new VEVO channel on YouTube through a special VEVO branded embedded player. It launches later this year. 

They’re dovetailing this with their recent update to Click-To-Buy, in which YouTube’s partners can sell music via many of the music videos found on YouTube – now in more countries including Australia, Canada, France, Ireland, Italy, Japan, New Zealand, and Sweden. For the full story, click here.

Blockbuster on the Way Out?

Blockbuster struggled to compete with Netflix for years, and now it finally looks like the war has taken its toll. According to Engadget, the company is near financial destruction:

In a recent SEC filing, the company made perfectly clear that there was serious risk that it wouldn’t be able to refinance its crushing debt load in order to stay afloat for a wee bit longer; in fact, it noted that said quandary raised “substantial doubt” about its “ability to continue.”

Not that anyone is really surprised, but competition is always a good thing.