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Summary:

Hulu caused quite a stir this week when, at the request of rights holders, it shut down Boxee’s access to its streaming video platform. While many discussed the business implications of this move, some are ready to do more than just talk about it. One reader […]

Hulu caused quite a stir this week when, at the request of rights holders, it shut down Boxee’s access to its streaming video platform. While many discussed the business implications of this move, some are ready to do more than just talk about it. One reader wrote to tell us that he’s gonna stop using Hulu altogether and go back to downloading TV shows via BitTorrent. Lifehacker editor Adam Pash apparently had the same idea, given his post entitled “How to Get Hulu Content on TV Without Hulu’s Help.”

Granted, so far this is all just anecdotal evidence. Chances are the move will cost Boxee more users than Hulu in the near term. However, these aren’t the only dark clouds on the horizon of Hululand; longer ad breaks and old media conflicts could turn people off Hulu-like streaming video platforms. Piracy, on the other hand, is getting easier and easier every day, with torrent sites and other unlicensed platforms just waiting to embrace Hulu renegades. Maybe it’s time to send the following memo to Hollywood: You can still blow this thing.

Part of Hulu’s success has been the result of the frictionless access to content. Hulu’s promise has been to make content available to people who didn’t have easy access to it before, and we’ve lost count of the numbers of users and industry insiders alike who’ve told us how much easier the service is to use than BitTorrent. No additional software to install, no waiting around for downloads to finish, and best of all, no port forwarding needed in order to deal with your firewall settings. All of this has helped Hulu to gain a strong audience, taking in 7.2 million video views in January. The networks’ own offerings have been helped by similiar ease of use as well; for example Lost netted ABC 1.4 million viewers in December alone.

However, the supposedly frictionless world of online video has become quite bumpy in recent weeks. First there was FX pulling It’s Always Sunny From Philadelphia from Hulu, prompting angry responses from fans and an apology from Hulu CEO Jason Kilar. Then word came from ABC that the network is thinking about showing its web users twice as many ads. And then Hulu on Boxee stopped working.

And now we’re witnessing the first shots be fired in what could become a full-blown war between NBC and FOX on one side and CBS on the other, with cable providers getting ready to open up a third front with their own offerings. We’ve seen these kind of conflicts before, for example when NBC decided to pull its content off of iTunes. Only it didn’t really make a difference back then, because hardly anyone watched TV shows via iTunes. (In fact, some argue that iTunes still doesn’t really count.) Licensing-based blackouts like the recent move by Hulu to disable content on TV.com, on the other hand, are starting to affect a growing audience that is just getting used to this new way of watching TV.

And it’s not like these folks don’t have any other convenient options. Applications like the Torrent Episode Downloader (TED) make it easy to subscribe to whole seasons of your favorite TV show via BitTorrent, and established TV torrent sites like EZTV even offer P2P streaming for immediate access.

Others are rediscovering Usenet, the original piracy hotbed. Downloading content from Usenet servers used to be somewhat tricky, but a new generation of Usenet clients makes it possible to utilize progressive downloading and watch content in a streaming-like fashion. Some folks have even figured out how to combine Usenet with subscription mechanisms, making it possible to download whole seasons of a TV show through a Usenet service provider with an interface that is as easy to use as iTunes.

Hulu CEO Jason Kilar probably said it best when he titled his apology for yanking Always Sunny “Customer Trust is Hard Won, Easily Lost.” Now let’s hope that this message isn’t completely lost on rights holders.

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  1. There’s no question that modern day Usenet can be a great user experience, as it eliminates many of the downsides of Bittorrent (lack of privacy, fluctuating speeds, etc.).

    The higher difficulty level and the need to pay a news server will probably prevent it from becoming very mainstream, however. I wonder as well if the large news serving companies (Giganews, Newshosting) will make easy targets for the Hollywood legal teams. My guess is that the much simpler direct download sites like Rapidshare and MegaUpload will (have) become the next big thing in file sharing.

  2. Some XBMC plugin coders have already got around HULUs encryption they use to hide the location of their source files and I think this is why content owners are blocking access.The XBMC plugin doesnt play the commercials like the boxee one did .

    http://lifehacker.com/5157524/bring-hulu-back-to-boxee-and-xbmc

    It was pretty easy to directly download HULUs video’s before they added this encryption now a Flash client is needed to unlock the content .

    HULUs High Def content is in H.264 and the videos with commercials removed is ending up on filesharing networks this is why content owners are getting touchy .

  3. users will find a way to get the NBC/FOX content on to boxee, but it is happening without NBC/FOX being able to monetize (unlike Hulu on boxee), whether it is bittorrent, streaming hulu without ads, or some other solution.

    we believe boxee will come out from this mess stronger.

  4. @avner At least your partners at Joost and thier content partners like CBS …Get It and are able to monetize via Boxee and other platforms like the iPhone .

  5. Hulu’s great, but it didn’t even have all the goos shows (entourage, curb, etc). I mean, in my dorm we use Hulu but also other services like Cavenger and GreatStuffTV, etc. Point is, businesspeople act like Hulu is the only service people use – and it’s not.

  6. Piracy will eventually kill off all the good shows, and leave us with crap like Big Brother.

    If the content owners can’t recoup their costs, they’ll cut the shows. And scripted shows are the most expensive shows….

    If you can’t even be bothered to watch the ads for a show, then the network doesn’t count you as a viewer. When they make the decision to cut a show, it doesn’t matter if a billion people torrented the show on the Pirate Bay if they can’t make money off of it.

  7. The big networks have forgotten one other thing.. Outside of the US.

    We Canadians get 90% of our TV from the US but services like Hulu (and Pandora and many others) are not available to us and may never be.

    Piracy is still the mode of choice north of the border.

  8. Matt, your point about ripped Hulu streams winding up on p2p sites is an important one IMHO. Not because it’s actually materially important, but because it give cable companies an excuse to pretend the walled garden system will protect content.

    Is there real evidence that’s true? I just assumed all the p2p content came from over the air since it’s the highest quality and easiest to capture and transcode, is that not the case?

  9. I normally check hulu for an episode of something and if it isn’t there, off to pirate it I go. Case in point I wanted to watch the new battlestar this morning, It wasn’t on hulu/scifi yet. So I went and pirated it. I’ll give them a chance to make money off me with advertising but if they don’t want it, that is their fault.

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