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Is Hulu Driving People Back to Piracy?

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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 (s dis) 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 (s ge) and FOX (s nws) on one side and CBS (s 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 (s aapl). 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, 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.

39 Responses to “Is Hulu Driving People Back to Piracy?”

  1. I’ve stopped watching Hulu due to the increase in commercials. I won’t support their site when it’s getting to the point where there’s all most as many commercials as on network tv. Between them blocking so many HTPC systems & now with all the commercials they force feed us I’ve reached the breaking point. I now just order the dvd from Netflix & download the current weeks shows in torrent form.

  2. Too many commercials take the fun out out of watching movies. One minute every fifteen minutes is okay. That gives the viewer a break also.

    I don’t want it for free but it should be cheap because of the masses. All people are not stupid. They don’t always know what is right, but they can tell when something is wrong usually!

  3. Matthew Long

    I dont have a problem with them having advertisements mixed in with the videos their showing on HULU, but they need to keep the ads out of the video player (period).
    If i have to wait 30 secs to see a 2 minute video I will NOT stay on that website long.

    I can go to youtube and watch all kinds of video and never see a commercial…..(thats what the adds are for all over the page)

    Thats what’s great about the net…. you just pick another site…..

    the people have more of the power on the NET!!!!

  4. To be honest, I hadn’t considered torrents for movies/shows in many years. When hulu came along on boxee, I was elated to find that I had access to a lot of shows, legally, with a minimum of annoyances! Well, now that it’s gone – I guess piracy is the only real option for getting content off of the internet and on to my TV.

    Or, better yet, just accept that the content providers don’t actually want me to see their content. That’s fine, I was probably better off without it anyhow.

    Since hulu dropped boxee, well, let’s just say, my TV watching time has dropped dramatically.

  5. Blaming the networks for piracy is just rationalization. Pirating is stealing. Nobody owes you free entertainment just because you whine for it. By the way, I don’t work for the television networks. I just happen to be a thinking person who believes that there is nothing wrong with making money through entertainment and that the people who receive entertainment should pay for what they receive either directly or through ads.

    Hulu is not “driving” people to piracy. Freeloaders and pirates are driving providers to increase annoying protection .

  6. I have been thinking about the P2P issues and HULU and the desire to pirate video and some have talked about the money is the issue. If the networks cant sell advertising We are going to be left with no shows. Or worse The makers of shows will make the show the comercial 30 mins of product placement all wrapped up in a cute story with hot sexy people telling us how great our life will be if we buy “what-ever”. So next time you want to pirate something…Think”How would this look with “Product” plastered all over it.

  7. Susan Rich

    I realize I’m a naive relic of a time long past – but how is a content producer supposed to make money if people don’t watch advertising and thus advertisers don’t advertise? Every time union negs come up all the union members talk about how they’re going online and make their money and screw the movie and TV studios but it looks to me as though we have raised a generation of viewers who not only want their content when and how they want it but they also want it for free – no advertising, no paying. Seems like a mighty hard model to make work. No matter what the creative side may say (and hey I’m part of that creative side), it takes capital and advertisers to take the monetary risk and to underwrite the big productions.

  8. Tony Frederick

    Do any of you think Apple will do to video what they did to audio with the iPod?…or maybe some hybrid version with limited advertising offered as an alt to pay-per-view? Seems like AppleTV is due for a re-launch.

  9. Paul your right to a certain extent and HULU is far easier to use than a Torrent Client but when that access is not available anymore on your prefered way to watch TV ,which should be on the TV not a Computer Screen, that boxee tends to provide it gets anoying .

    boxee at the moment is a first adoptor product but as it matures I expect it or something like it will be the future of TV UI’s especially with Internet/IP Network ready TVs on the rise , Consumer Electronics is the space boxee is playing in not piracy.

  10. The old media certainly seem to be stifling streaming services and downloads so that it just seems easier or cheaper to buy DVD’s or keep the Cable/Satellite package or turn to piracy. I think many of them underestimate the lure of piracy and its free-ness.

  11. Well, we may have a different notion of the term “mainstream.” Current data shows 23 million people using The Pirate Bay at any one time, and while that is the biggest Bittorrent site, it’s far from the only one. A quick Google search found an NPD study from December 2008 that stated regular P2P users were 14% of US internet users. Is it a majority? No. Is it less than 5%? Absolutely not, as that number did not include anybody that had ever used Bittorrent but wasn’t currently.

  12. Lots of traffic coming from a very small number of users does not make it mainstream. In fact, it is exactly this phenomenon that is forcing the cable co’s to start throttling bandwidth for the torrent users. What percentage of internet users have ever used a torrent site? probably <5%. Just the mere fact you have to download and install a client is a huge barrier to adoption here. Just look at how Joost did with that model. Add the privacy and ethical concerns an average user has to the hassle factor and it will never be something the average internet user does.

    Keep in mind, the average US internet user is not a New TeeVee reader. The comments here are anything but representative.

  13. Um, I hate to break it to Paul but Bittorrent is absolutely mainstream, whether he wants to believe it or not. Estimates currently put about 50% of all internet traffic to Bittorrent. If you can use a computer, you can use Bittorrent.

  14. Using bit torrent is still a huge pain and will never be mainstream. Tech geeks and dorm room hackers are NOT the average consumer in the US. This entire argument is overstated.

  15. Neno Brown

    Great post, Hulu themselves would I amagine love to have every show accesable for everyone to watch and monetise on ad revenue, but the studios are still locked into the old media theology.

    Content is king at the end of the day and people go where the content is, so if that means torrents then torrents it will be.
    The whole piracy thing is a self fullfilling thing, fed from the lack of access, if the studios recognise this and show some courage in breaking down there closed walls, they will begin to make some returns on there investments.

    I cant help but feel unless they (studios) wait to long in finding a way to appeal to the consumer, they will find increased competition from the independent’s and/or the pirates.

  16. @Joe Born this quick HULU torrent search on the Pirate bay links to several Its Always Sunny in Philidelpha episodes including a season 1-3 Torrent .

    HULU’s HD videos are available as H.264 encoded video without any watermarks like you will find on cable or OTA broadcasts and they are the source files from HULUs servers .

    HULU where only obsficated these links as behind a URL(PID) and then timed out the URL(PID) after a few minutes ,the URL to the source file was visible in Firebug for example or many other /analysis /scraping/development tools . This was very poor security on HULUs part .

    This is how Boxee and XBMC where getting the videos without any formal agreement with HULU.

    The XBMC plugin developers have found a workaround that uses a very trimmed down flash client just so they can access the encrypted location to the HULU PID and this might break when HULU makes some changes (because of the encryption) but can be easily fixed within a day or less.

  17. I would say Hulu has pulled me away from a lot of situations where I would pirate T.V. shows. Doesn’t mean I have stopped, there are shows I watch not on Hulu, and Hulu doesn’t have every episode.

    On that note I don’t think we can blame Hulu for this. I’m sure they would love to have every episode of every show at there disposal. What we have to do is blame the studios for this. Sad part is the studious are only hurting them selves. Because when Hulu doesn’t have it I bit-torrent it, and they get no ad revenue that way.

  18. 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.

  19. 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?

  20. 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.

  21. Joe the Reader

    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.

  22. 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.

  23. 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.

  24. 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 .

    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 .

  25. 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.