Quincy Smith on Hulu

From Forbes:

"Yes, we're constantly talking to [Hulu]. We'd love the opportunity to do it, assuming that the deals make sense. I don't know Jason [Kilar, Hulu's chief executive], the guy they got from Amazon, though I certainly know a lot of people who know him and respect the heck out of him. If anyone could try and build a next-generation destination, it's probably him, based on his background.

I love everything about the joint venture and the notion of syndicating content with distribution partners that are already proven in the business, both in the video-destination and the widget business. But why--why still hold on to a destination [Web site]? That's a huge amount of infrastructure, that's a huge part of investment and frankly, a huge distraction."

Hulu does something - rumormill

TechCrunch set off a blogstorm of posts over the rumor that Hulu is buying Mojiti.

From TechCrunch:

"It is surprising that Hulu would use a third party platform for their service rather than build it themselves from the ground up. They’ve already missed their promised Summer 2007 launch date, however, and probably think the acquisition will get them to market faster."

Michael in the comments: "remember when they promised a mostly decentralized platform? no mention of that recently, and mojiti isn’t the right tech for that. I sense chaos and disorganization, not a smart strategic decision to buy v. build. And a new strategy to focus on a centralized, youtube-like site. And remember that Adobe already built all the hard parts of this and put it in the Flex platform. For some reason people are giving Hulu a lot of room before judging them. I prefer to judge them now."

From PaidContent:

"The exact role Mojiti will play technologically is unclear. NBBC’s technology was supposed to be the foundation for the distribution network—the distribution player will be skinned to match various destinations—but, in its previous incarnation, it hadn’t operated on the kind of scale Hulu requires. The destination portal will have its own video player, which is where what Feng and his team have been working on may best fit in.

Feng is just part of the shifting staff at Hulu, which started life with a team borrowed from NBCU and News Corp. Many of those involved at the senior level, including some whose managers expected to stay with the new venture, are in the midst of returning to their respective companies. The mantra I’ve heard: Kilar wants his own team."

Hulu: the hating game

NBCU gave everyone plenty of time to store up the hate for the newly named Hulu. So let the games begin.

From Techcrunch:

"Congratulations are in order to YouTube-competitor Hulu, which took just five months to come up with a name after announcing itself in March. CEO Jason Kilar says the name “captures the spirit of the service we’re building” in an open letter published today.

Just don’t translate that name to certain languages, because the name may capture significantly more of the spirit of the service than NBC and News Corp., the media giants behind Hulu, intended.

Given the litigious nature of online video, that is some serious irony. And you can bet that Hulu, and its parent companies NBC and News Corp., are going to be sending out one heck of a lot of cease and desist letters as soon as this thing launches."

From Silicon Valley Insider:

"For anyone keeping track, that means the venture now has a $100 million investment from Providence Equity, a $1 billion valuation, a CEO and a name. Great! Only a few more hurdles left! Hulu still has to deal with the fact that it:

• hasn't launched
• has 120 employees and a big burn rate (call it $10 million a year)
• has a deeply entrenched, globally dominant competitor
• is two years too late
• has been shunned by the other big dogs in the industry (CBS, Disney, Viacom)
• is a joint venture between two companies that hate each other."

From Terry Heaton:

"This portal has been so hyped as God’s gift to online video that any name they came up with would likely have bombed, especially with the tech community — which includes the people who’ve written the book on online video without the “help” of the networks or studios. Old media just doesn’t get that new media isn’t created in a board room with fancy consultants (oh shit, I’m a consultant!), because the results are usually just varnished horse crap. Hulu?

The problem is that the fuss over the stupid name casts a pall on what is really a smart move by NBC and Fox, namely creating a single portal for video instead of asking people to come to each branded site. Of course, it would be better if all networks were a part of this, and I think announcing the project without a name or a more complete partner list was a huge tactical error."

From Steve Sarfran: (Lost Remote)

"Three stages in newly named web product:

1. Everyone hates it, makes fun of it
2. People slowly adopt it, forget that they hated it
3. People start to use it either as a verb (”Google that”) or in comparison to inferior products (”It’s no flickr.”)"

Clown Co = Hulu

Fall is in the air (not really in Atlanta) and the branding exercise is over, NBCU and News Corp present Hulu.

From Techcrunch:

"This morning news broke about NBC Universal and News Corporation’s joint video venture, hitherto dubbed “Clown Co.”, after a press release was sent out by a Hulu.com representative claiming that “Hulu” was the new name for that venture.

Initially, I was a bit concerned that this could be merely a hoax, as no press releases were sent out by NBC or News Corp. themselves. However, after speaking with the Hulu representative, Christina Lee, and seeing the news spread across the circuit like vine, it does appear as though this announcement is authentic."

From Reuters:

"We just wanted a name that is short and easy to spell," Hulu spokeswoman Christina Lee said. "We like the idea that it rhymes with itself. We wanted a fun name."

From Ad Week:

"When it does launch, the site will allow fans to stream episodes of NBC series such as The Office and Friday Night Lights, along with the soon-to-launch remake of The Bionic Woman.

Meanwhile, Fox is planning to offer on-demand episodes of staples like The Simpsons and Mad TV as well as premiering shows such as the New Orleans-set cop drama K-Ville. In addition to Hulu.com, the sweeping venture will see these series distributed across the biggest sites on the Web, including AOL, MSN, MySpace and Yahoo!.

"Why is Hulu the new venture's name? According to a note posted on the site by newly installed CEO Jason Kilar, it's meant to connote fun and simplicity. "Objectively, Hulu is short, easy to spell, easy to pronounce and rhymes with itself," he wrote.

"Subjectively, Hulu strikes us as an inherently fun name, one that captures the spirit of the service we're building. Our hope is that Hulu will embody our (admittedly ambitious) never-ending mission, which is to help you find and enjoy the world's premiere content when, where and how you want it."

Clown Co, NBCU and Peacock Equity

NBC is out in front today with two stories. The first is a head to head about web video with Sab Kanaujia, vice president for digital product strategy at NBC Universal and Steven Starr, co-founder and chairman of Revver. The second is a somewhat strange interview with NBC Universal Chief Digital Officer George Kliavkoff.

From the WSJ:

Sab Kanaujia begins: Can independent creators make a living with Web video? I don't think they can in the short term. Current business models online are not attractive enough to make a living or leave your other day job.

Steven Starr responds: Well, it all depends how you define independent creators. Old school independent creators, used to Hollywood economics, should stay home. But successful independent online creators are seeing CPM and [cost-per-click] returns that can exceed $10,000 per month.

From Forbes:

"Will New Site be distributing any content through widgets?

New Site is working through that. It's certainly their right to do that, and there's no reason why they wouldn't want to do that.

NBC Universal and GE Commercial Finance launched a $250 million Peacock Equity Fund in April to invest in media and technology companies that are developing products of relevance to NBC. How does the fund fit with your overall strategy?

This is a way for us to seed digital businesses and to have an equity stake. Most of the time, we take an equity stake, we have an operating relationship as well. So it's a great way for us to play the field. We've announced three investments so far; we've made five. We think we're well on pace to distribute that $250 million over the two- to three-year life span that we expect it to last.

In January, NBC signed up with Qualcomm's MediaFlo platform to provide two channels of programming. Mobile video doesn't seem to drawing much in the way of traffic yet. What has to happen for that to change?

I generally think that underlying that is a larger issue with the way video content is distributed on cellphones in the United States. Today, it's a broken business model. If you look across most of the platforms on which premium content owners distribute their content, on almost every platform, the total gross dollars for the consumption of that content is shared in a way where the content owners, on the aggregate, get more than 50% of the gross dollars.

In this country, if you look at the gross revenue of content distribution on mobile phones, 9% of the gross revenue goes to content owners, 70% stays with the carriers and 21% goes to content aggregators and other middlemen. We think over time that that'll get fixed. I believe the carriers are like us, long-term greedy, not short-term greedy. There are two ways to get that fixed: either we do that in partnership with the carriers or we figure out ways to go around the carriers. We'd much prefer to do it in partnership with the carriers."

Mike Cassidy loves Clown Co.

In a breathless review of, well, of not much of anything, Video Insider's Mike Cassidy predicts great success for Clown Co.

From Insider Video:

"It appears as though the company is starting out right by selecting a digital executive to lead it. Jason Kilar has a good reputation and appears to be a wise selection. The management behind this venture knows they need fresh and creative thinking, and that starts with leadership that comes from the online world.

When the joint venture was first announced I commented that this was exactly what the industry needed to jumpstart the online video marketplace.

My advice to the soon-to-be named venture is to learn from the past but focus on the future. Leverage your media parents’ assets and capabilities, but be nimble, dynamic and act like an Internet start-up that has just received its first few million in financing. Be aggressive and outspoken and come to market with lots of new and unique video sponsorships ideas, especially for all those pre-roll naysayers. If you do, I think this company can be the most significant player in online video in 2008 and beyond."

NBBC: parts and pieces to Clown Co.

From beta launch to dead pool in 10 months.

From TechCrunch:

"The remains of NBBC will be merged into the NBC/ News Corp joint venture first announced in March.

The new service, dubbed Clown Co by some has long been discussed but to date is yet to appear. Strangely, News Corp recently launched MySpace TV, a YouTube competitor in its own right that will compete directly with the NBC/ News Corp joint venture.

In an interview with MediaPost, George Kliavkoff, NBCU’s chief digital officer justified the closure of NBBC as a step towards strengthening the NBC/ News Corp joint venture : “we saw that “NewSite” could use NBBC’s resources, so last Friday afternoon we agreed to contribute it to the NewSite effort.”

The closure of NBBC and the transfer of IP and talent does not extend to existing agreements. Over 150 partners of NBBC, including Hearst, A&E Television Networks, The Horror Channel, Vibe Media Group, CNET Networks and Forbes.com will be required to negotiate new contracts with the new service."

Internal memo to content "partners" via Lost Remote:

"As part of our contribution, nbbc must sever all on-going business relationships in preparation for the merger. Therefore, this note serves as your 30-day notice of service termination with nbbc. NewSite is an independent operating entity and may reach out to you to explore potential business partnerships."

From TechCrunch comments:

"I’ve been consulting with NBBC. It’s kind of a nightmare being in the meetings. None of the senior executive team have any clue as to how to build a video portal, or how to build a cohesive development team. None of them have a clear vision - its ridiculous. They expect to compete with the likes of Youtube and Google, and there is much talk of building the killer experience, yet they can’t even put out a ’standard’ product that just works."

ClownCo gets a leader: already worth $1 billion!

The not-yet-named joint venture between NBC and News Corp has named a leader.

From Lost Remote:

"Former Amazon.com senior VP, Jason Kilar has been named to head up the video joint venture organized by NBCU and News Corp. Kilar had written up the business plan for Amazon’s entry into the video and DVD business. A name for the joint venture has yet to be announced, and NBCU and News Corp. still say the launch is planned for this summer."

From NewTeeVee:

"But the company, which still doesn’t have a name, is making the rounds meeting venture capitalists, and private equity people trying to raise $100 million on a valuation of about $1 billion. Multiple sources both in New York and Silicon Valley have confirmed NewCo’s attempts to raise cash. PaidContent had reported on this last month, and since then things haven’t changed much."

Clown Co.: DOA

Changes is Good thinks the new effort by everyone not Google is going to fail.

From the post:

"The three main reasons its sure to flop are:

1) Control. The networks are creating the site in the hopes of controlling how their content gets used, shared and distributed online. I’d guess that in a dank colorless conference room, a bunch of middle management MBA’s convinced a non-MBA executive that this was a good idea by boring her into submission using PowerPoint.

2) Content. Millions of people are uploading tons of content that stretches across the interest spectrum to GooTube. Of course they dont have a snowflakes chance in hell of generating the kind of serendipitous discovery, niche connection and mass appeal that GooTube can facilitate.

3) Cooks! Name one loosely knit media association, that doesnt involve ownership stakes or JV rules, that has been successful. These arent natural partners with complementary strength and weaknesses pairs. Its a an association Google hater getting together to drink their own haterade."

Why Apple TV is a game changer

Sure there are a ton of posts about the Apple TV but here is a good one on why its going to make an impact.

From NewTeeVee:

"Technically, the Apple TV may be simple, but its effect on the TV industry will be anything but. Why? Because TV business models that have thrived for the past thirty to fifty years that relied on:

• Advertising-supported TV.
• Prime-time programming.
• Bundled content.

Apple TV is about to attack the fundamental assumptions underpinning the TV business just as the iPod cut the legs out from under CDs and radio stations. How? Because with Apple TV combining the flexibility of the Internet with a living-room, big-screen experience, consumers now will:

• Vote for programming with consumer dollars.
• Watch what they want, when and where they want it.
• Enjoy TV programming a la carte."

The interesting thing about this to me is that those fundamental changes are certainly valid for the Apple TV product but also describe the ground shifting change that other companies are bringing to the world of TV. Think Joost, Clown Co and Youtube.

Clown Co. pile on

As you no doubt know, NBC and Fox ( and MySpace, Yahoo, MSN and AOL) announced the formation of a yet to be named company (ClownCo. for you Google people) to create the largest advertising platform ever.

From Bloomberg:

"NBC and News Corp. will create a new Web site that features full-length films and television shows, the companies said today. Yahoo! Inc., Microsoft Corp.'s MSN and Time Warner Inc.'s AOL, Google's biggest rivals, will distribute the shows on their sites."

From PaidContent:

"Zucker: Within hours of word getting out yesterday they had five charter advertisers and two more came in this morning. (One is Royal Carribean.) There will be a separate ad sales force for Newco.

YouTube: Chernin: “This is obviously not a YouTube killer. It it were .. we’d obviously have a standalone site ... We’re obviously willing to meet with anybody” who meets business and copyright requirements. They have already talked to Google (CEO Eric Schmidt) this morning."

From WVfF:

"Based on Yahoo, AOL and MSN’s involvement I’m not sure this is an online video “site” at all. It sounds like a new distribution platform for NBC and Fox. This is motivated by the old “an enemy of my enemy is my friend” theory, but I do think it’s far more sustainable than previous attempts by networks to dethrone YouTube and others. For starters, it will have good content and a wide audience."

More PaidContent:

"Content partners coming in now will have “extraordinary content protection—IP protection that they hadn’t before. ... Any distribution partner is already signed up to protect your content.”

The executive said all of the partners committed to protection beyond the requirements. The deals include filtering of all user-uploaded video. “If you’re getting paid for Heroes on someone’s profile page why would you let the same clip be uploaded by someone?”

One more point: “The content-protection language was negotiated long into the night for the last three nights—no other (prospective) content partners know what we’ve got.”

-- a “really favorable rev share on the advertising” (We have confirmed independently that split is 90-10 for equity partners.)

-- “the opportunity to opt into a network that gives you immediate access to 96 percent of U.S. internet users”

Lost Remote 1:

"What about affiliates? “Potentially they could be distribution partners,” NBCU CEO Jeff Zucker said. “We’ll be looking at that in coming days.” But currently, no profit sharing for affiliates."

Lost Remote 2:

"NBC’s owned-and-operated stations division has shown interest in becoming a distribution partner for the new NBCU-News Corp. video site, a NBCU exec tells Lost Remote. As we’ve reported below, NBC and Fox affiliates currently aren’t partners in the new joint venture, but the exec said “there’s no reason why any of the affiliates can’t be distribution partners,” which would involve a revenue share of the advertising. “We want to talk to them.”

Lost Remote 3: round up of MSM comments

"USA Today: “NBC Universal and News Corp. … unveiled their splashiest effort yet to hang on to people who want to watch popular TV shows and movies on their computer screens.”

From Terry Heaton:

"While everybody’s whooping and hollering, it cannot go unnoticed that the affiliates take it in the shorts on this deal (again). Oh, they have protections built in (the delay window will be several hours after shows air in Hawaii), but this is certainly a play that by-passes the affiliate system. I suppose the next move would be for broadcast companies to get in on the deal and provide their locally produced content in a similar manner."

From Terry Heaton's comments:

"Terry I don’t really see what’s in this NBC/News proposal for broadcast companies like LIN and Belo. Why would a viewer click on a several hour old clip from Wichita Falls News@6? Most local affiliate produced content has the shelf life of a good French baguette — less than a day. Besides the Clownco/Newco revenue model doesn’t leave room for local advertisers. No, this is 110% bad news for the affiliates."

From TechCrunch:

"There will be no centralized site for the service. Instead, content will be available through distribution partners, who will also receive a small share of advertising revenue. The company also said they will be looking to add many more distribution partners, and users will also be able to embed content (along with advertising) directly into their sites.

The two key messages Chernin and Zucker were selling were (1) a focus on respecting copyright, and (2) the fact that they were creating what they called “the largest advertising platform on earth.” That may be good messaging to stockholders, but it isn’t what the public cares about.

First, the fact that only two networks joined is a really bad sign. Viacom at least should have been willing to join. Second, this group has little experience in creating web applications, and no experience building the kind of stuff, like YouTube, that users get seriously passionate about. Third, the track record of major media companies working together to deal with this kind of viral attack on their business is not good."

From TechCrunch comments:

"A DRM-ed video full of adverts. Man, how can I get myself some of those! (And this is coming from someone who runs a site that only features videos. You’d think I’d be excited by the prospect of a streaming episode of ‘Heroes’ but sadly no. Not in this format.)"