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Could the Hulu, Disney Deal Create a Tangled Video Web?
By: Chris Preimesberger
2009-05-02
Article Rating:    / 3
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Could the Hulu, Disney Deal Create a Tangled Video Web? (
Page 1 of 3 ) Hulu, iTunes, Disney, YouTube and others are engaged in a battle for viewers that is heating up the lucrative video streaming business. Meanwhile, Apple co-founder Steve Jobs and Google CEO Eric Schmidt are entangled in a virtual soap opera of conflicts that involves both their private investment interests and their companies' business strategies.Competition in the television- and movie-fueled online video streaming
business is getting more and more intense. And the personal involvements of
Apple co-founder Steve Jobs and Google CEO
Eric Schmidt in this burgeoning market complicate the story to the point where
it resembles a made-for-TV movie.
There's a premium on high-end TV and movie content, and the battle for the good
stuff appears to be getting very serious, because the big-bucks people are
writing checks for their stakes. And some of the internal powers behind these
battles appear to have real conflicts of interest to smooth out.
Let's start from the beginning, shall we?
For most of this decade, YouTube and its free-for-viewingand mostly
amateur-createdfare has been ruler of the online video universe, particularly
since it was acquired by Google in November 2006 and infused with a rather
plump $1.65 billion investment. Fox Interactive and CBS.com are smaller players
here.
Apple's iTunes, the online leader in music sales, also has been important in
the video marketplace, although its pay-per-download model is vastly different
from YouTube.
Now comes a brash newcomer, Hulu, which is starting to make this a new dance.
Hulu, which in Mandarin means "holder of precious things," was launched
in March 2008 and already holds a lot of sought-after video content, featuring
shows from NBC, Fox, Comedy Central, PBS, USA, Bravo and about 100 other
networks. All these sites also earn revenue from ads that run in conjunction
with this programming.
Hulu distributes video both on its own site and syndicates its hosting to other
sites. It also allows users to embed Hulu clips on their Websites.
Hulu soon will be holding even more of the good stuff. It made news April 30
when entertainment giant Disney
wrote Hulu a large check to become a 27 percent equity owner.
Upon completion of the Disney deal, Hulu will display current and archived
Disney and ABC programming, including hit
shows such as "Lost" and "Desperate Housewives" and a list
of classic movies.
None of this is good news for iTunes, as its pay-for-play model may find itself
in serious jeopardy. No one wants to pay for shows they can get free elsewhere.
For example, a fan of the hit TV detective show "Monk" has to pay for
an iTunes download; it's free on Hulu.
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