It looks as though video streaming site Hulu is on the verge of dropping the price of their Hulu Plus service dramatically. The pay service, which launched in June for $10 per month, could be cut in half to only $4.95 a month. This may be an indication that Hulu has been unable to lure in enough users during the beta period to make the service viable.
Hulu Plus as designed to bring in a second, and presumably larger, revenue stream. But lacking selection has apparently stifled demand. Many of the shows Hulu offers additional content for on Hulu Plus are from the studios that own stakes in Hulu including Fox, NBC, and ABC. Most cable shows are left out of the Hulu Plus line-up.
We're forced to wonder, is this an indication that Hulu won't be getting a better selection? If they could beef up the catalog, keeping the $10 price point could be a possibility. Since they are lowering the price, that could be a sign that it isn't getting much better than this. Would you subscribe to Hulu Plus for $5 a month?
We're reminded today that back in the late 1990s, Warner Bros. was looking for leverage in their negotiations with Blockbuster. The studio took on a small ownership stake in the then fledgling Netflix. The other major studios followed suit. This was all prior to Netflix's 2002 IPO. All the movie studios sold their shares about a year after that.
This was probably a financial blunder of epic proportions. Netflix is hugely popular, and its stock is trading over $150 per share. It started at $15 in 2002. Aside from the monetary cost, the studios have to contend with the fact they could have had some control over this extremely popular entertainment option. As it stands, they may find themselves benefitting less from their interactions with Netflix.
What might have been if Hollywood had kept their stakes in Netflix? Maybe Blockbuster would have fared better if Netflix was being managed by the studios. Or perhaps we wouldn't be enjoying the plethora of streaming options on Netflix.
Owners of the PS3 have been able to watch Netflix streaming content on their consoles for some time now. The only problem is that it required a special streaming disc to be in the machine. But according to Sony, a new disc-free Netflix streaming solution is coming to the PS3 on October 18. The application will be free and it will be installed to the console like other apps.
If you live in the US, odds are you've used Hulu. You probably even think it's a cool service. But do you think it's worth $2 billion? That's apparently what Hulu thinks they're worth according to a report from Reuters. Sources say that Hulu is looking to raise $200-300 million in an IPO, which would value the entire company at about $2 billion.
The official filing should hit the SEC late in 2010, meaning the IPO will happen in the first half of 2011. Sure, these are some big numbers, but investors are still skittish. Hulu's entire business model relies on their network partners continued generosity. If they chose not to license content to Hulu, the site would quickly die. As it is, Hulu has to pay nearly half its ad revenue to content partners.
The recently launched subscription service is perhaps another way to pull in some cash, but it remains to be seen if Hulu can attract significant numbers of users. Still more, can they get the content deals to fill out the selection? What do you think Hulu's future holds?
Netflix is in the process of transitioning from a disc-based business, to streaming-based one. That much is clear from their recent content deals with the likes of Time Warner and Fox that get the service more content for online streaming. In exchange, Netflix abides by a 28 day window before they can have access to physical discs. Now it looks like another studio is taking Netflix up on that offer. Sources indicate that Sony has agreed to a similar deal.
Neither side is talking, but the details seem solid enough. Both sides in the deal are getting what they want. Studios get longer to push physical disc sales, and Netflix moves ahead with the streaming business that will carry them into the future. In addition to the 28 day waiting period, Netflix also pays less for the right to rent. Considering most consumers don't track release dates for discs, we think this is a pretty good deal. Would this change your rental habits?
At the Best Buy holiday preview event today, Sony was on hand to show off their upcoming Google TV equipped HDTV. The Sony NSX-46GT1 is a 46-inch set that uses LED edge lighting, and has Google TV baked right into the firmware. The Google TV interface was controlled in the demo with a wireless USB dongle plugged into a rear USB port. Users will be able to use a special Sony remote, or an iOS or Android device to interact with the TV.
What just a day ago was rumor, now is a sure thing. Both TiVo and Roku boxes will be getting access to Hulu's $10 per month Plus service. TiVo will be offering the feature to customers that purchase Premere DVR service. Of course, a Hulu subscription will still be required.
Roku is taking the pricing angle to lure in potential buyers. In a statement, Roku founder Anthony Wood called the company's streaming solution "the most inexpensive device to stream Hulu content [to a TV]." The Roku boxes retail for between $59.99 and $99.99 and have access to Netflix and Amazon video already.
Is this what TiVo needs to pull out of their slump? With the cheaper option in the Roku, it's tough to see how TiVo will attract new buyers with this feature.
People have really been anxious to see Hulu spread to more TV-connected devices since the service launched. The PS3 and iOS devices are a nice start, but it looks like Roku is up next. This is still up in the air, but sources are saying that a Hulu channel will be on Roku boxes in the coming weeks. It's not possible to know if this will be available for the free Hulu, or just for Hulu Plus.
The day had finally arrived; Blockbuster has finally filed for Chapter 11 Bankruptcy. Chapter 11 means that the company will have the opportunity to reorganize and rid itself of cumbersome debt. In the filing, Blockbuster listed $1.02 billion in assets, and $1.46 billion in debt. The company expects to be able to reduce its total debt to a mere $125 million.
Blockbuster has been seeing steadily decreasing sales as digital services like Netflix have taken of in recent years. The Dallas-based company has about 3000 stores currently. They are expected to close as many as 1000 of them. After they complete reorganization, Blockbuster will attempt to focus more on digital content delivery. Considering the lateness of this push, they'll have a lot of catching up to do.
The future is unclear for the brick and mortar chain. They have been able to bundle video rental app with some phones as of late, and this could be a possible way to move forward. We'd also like to see a viable competitor to Netflix in the online streaming category. But the worry is that content would become increasingly siloed; exclusive to one company or the other. Do you think Blockbuster can find a place in the market?