What if no one buys Hulu?

Chief Mouseketeer Bob Iger insisted Wednesday that Hulu’s owners are committed to selling the video streaming service.  But what if no one is committed to buying?

Of the half-dozen companies known so far to have been invited in to kick the tires by Hulu’s bankers, only one, Amazon, strikes me as a plausible buyer. The rest seem to have been chosen simply because they have deep pockets (Google, Microsoft, AT&T, Verizon), or, in the case of Yahoo, because it has already expressed interest.

Google: Hulu is owned by the same networks that blocked Google TV from accessing their online content and have largely refused to license their content to YouTube. Given that history, I’m skeptical they would now agree to let Google buy Hulu. Google has also been attracting increased scrutiny from regulators, including the FTC’s current anti-trust investigation of Google’s handling of search results. Read More »

Netflix looks for new friends on Facebook

Deals Netflix obviously wasn’t kidding when it announced earlier this year that a “major” integration with Facebook was in the works. Last Thursday, the two companies announced the Netflix CEO Reed Hastings will join the Facebook board of directors, about as close an integration as you can get without a formal merger.

Oddly, the announcement didn’t actually tell us much about how Netflix actually plans to use Facebook or what the integration will consist of. Much of the speculation triggered by the announcement focused on potential operational aspects of the integration, most of which could be achieved without tying the companies together at the board level. Presumably, then, there are other, more strategic reasons why Facebook’s CEO Mark Zuckerberg would want Hastings on his board, and why Hastings would want the seat. Read More »

The iCloud will not be televised

Digital Living Room The Apple TV cheese stands alone. For all the nifty new functionality built into iOS 5 and Apple’s new multi-device iCloud platform it appears that very little of it will find its way into Apple TV. About the only new reindeer game Apple TV will get to join in for now is Photo Stream, which automatically syncs and downloads your photos to all your registered iOS devices, including the Apple TV set-top. For everything else — including your own home videos — Apple TV is on the outside of the iCloud looking in.

I’m starting to believe Steve Jobs when he describes Apple TV as a hobby, rather than as a strategic business for Apple. Read More »

Did Apple just clean the record labels’ clocks again?

Cloud Now that we know the basic contours of the new iTunes in the cloud from Apple we can make some guesses as to why it took so long for Apple to nail down deals with the record labels. As it did when it when it first persuaded the labels to lock themselves into a 99 cent price for downloads, from which it took the labels years to extricate themselves, Apple once again seems to have done some fancy negotiating. And as it did in the beginning, it again seems to have managed to limit the labels’ financial participation in the iTunes value chain to one, rather smallish revenue pool.

Consider: Read More »

The iCloud vs. the us-cloud

Cloud Steve Jobs himself, back at least temporarily from medical leave, will take the stage Monday to keynote Apple’s Worldwide Developers Conference, where he’ll officially unveil Apple’s new iCloud service. According to numerous leaks, Apple has inked deals with all four major music distributors allowing it to launch a fully licensed, cloud-based system in which music is stored remotely and can be accessed from any iTunes-enabled device. Read More »

What next for the networks and Google?

Connected TVs The first generation of Google TV was essentially a browser and a search engine baked into a TV set or set-top box, along with an integrated UI that presented the search results irrespective of the source of the content. The idea was to try to establish search as a new modality for content discovery on connected TV in place of the multiple program guides, app stores and book marks that now clutter the connected TV experience.

The strategy made perfect sense from Google’s point of view because if there’s one thing Google really knows how to do it is to monetize search. Ninety-six percent of its earnings still come from search-driven ads, despite the growth of Android and other businesses.

The broadcast networks saw things differently, however. They viewed Google TV not as a user-directed content-discovery tool but as a Google-directed distribution platform for their web-based programming, which should have been licensed by Google. Read More »

Disney in the cloud with DivX

It hasn’t received much attention in the U.S., but in France this week, Disney announced perhaps the most aggressive move yet by a major studio to embrace both cloud-based media lockers and cross-platform interoperability. Two new services, called Disneytek and abctek, will allow Freebox ISP subscribers in France (currently about 4.5 million subs) to purchase Disney and ABC movies and TV shows through their Freebox TV set-top device and store them permanently in the cloud.

In addition to being able to watch the content on their TV via streaming, subscribers also can download the movies and TV shows to a PC or Mac for storage and playback, and can further transfer them to up to five other DivX-certified devices (The DivX devices must first be registered online) via USB drive or SD card. Read More »

Will clouds block UV light? (Updated)

Cloud Amazon is the first major player out of the gate with a cloud-based digital media “locker” service but it’s a fair bet that Apple and probably Google won’t be far behind. The question is: how long can they wait?

Both Apple and Google are reported to be attempting to negotiate licensing deals with the record labels that would allow them to offer cloud-based music storage and streaming services without fear of legal challenge or litigation. But that’s a lengthy process and Amazon’s decision to launch without such licenses may for Apple’s and Google’s hands. Read More »

Amazon takes another page from Apple’s playbook

The Cloud Amazon has already shown itself to be a close student of Apple, modeling its initial Kindle strategy on Apple’s approach to the music business: drive down the cost of the content to drive up the value of owning the hardware, which translated into more high-margin hardware sales for Apple/Amazon.

With the announcement Tuesday of the Amazon Cloud Drive and Amazon Could Player, the online retail giant seems to be taking another page from that same playbook. Read More »

Navigating the new TV landscape

Connected TVs Apple may be getting ready to license its AirPlay streaming software to other CE makers to embed in their HDTVs, according to a report this week by Bloomberg . Though the report did not identify the potential hardware partners, “two people familiar with the program” said AirPlay-enabled devices could be available before the end of the year.

If the report proves true, users of thirds-party AirPlay-enabled TVs would be able to stream video content over their home wireless network from the iPad, iPhone or iPod Touch for display on the big screen. Currently, video streaming from Apple portable devices is only possible via an Apple TV set-top box. Under the proposed plan, no separate set-top hardware would be required. Read More »

Dissing disintermediation

Online Video Needham Insights analyst Laura Martin and colleagues are out with an interesting report this week comparing and contrasting the demand curves for analog and digital entertainment goods, and the pricing implications of each.

According to their analysis, demand for entertainment goods in the analog world, in this case consumers’ willingness to subscribe to a particular TV channel, is fairly inelastic, in that a change in price at any point on the curve has relatively little effect on the amount consumed. Thus, the demand curve exhibits a traditional, smoothly curved shape as prices decline (below).

In the digital world, however, their analysis shows that demand is top heavy: a small slice of the audience accounts for a huge percentage of the use, making for a much steeper demand curve when plotted against the total consumer spend on the goods or service in question (below). Read More »

Apple and the importance of accessorizing

Streaming Video For most who followed Apple’s announcements today, the big news would have been the new lighter, thinner, faster version of the iPad, the latest iteration of iOS (iOS 4.3), which adds some features like local music sharing between devices on a home network, and of course the appearance on stage of a game, if painfully gaunt, Steve Jobs. For the studios and premium TV networks, however, the real news was something literally just tossed in.

That would be the $39 1080p HDMI output dongle for the iPad 2 (dongle sold separately of course). From the perspective of high-value video content, the dongle basically turns any TV with a HDMI port into an Apple TV. With the dongle, an iPad 2 owner can download or stream copy-protected video to the tablet via iTunes or other app and display it on their big-screen TV, even if the user does not have an Apple TV set-top box. Read More »

Apple looks to close the book on browsers

App Stores A piece in the New York Times Tuesday set off a torrent of speculation over an alleged new move by Apple to “tighten control over [its] app store.” The story paraphrased Steve Haber, president of Sony’s digital reader business, saying Sony had been told by Apple that “some applications developers, including Sony… can no longer sell content, like e-books, within their apps, or let customers have access to purchases they have made outside the App Store.”

The hook for the piece was Apple’s apparent rejection of Sony’s e-reader app for the iPad, which let users buy e-books through the Sony Reader Store and to access e-books they had already purchased there from their iPad. From now on, Apple allegedly told Sony, “all in-app purchases would have to go through Apple,” which takes a 30 percent cut of all such transactions. Read More »

The Pay TV Empire strikes back

Connected TVs What’s the opposite of “over-the-top”? Whatever the correct term, it was on display at the Consumer Electronics Show last week, where pay-TV operators and their allied solutions providers unveiled a host of initiatives and technologies designed to help cable and satellite companies wrest control over IP-delivered video from interlopers like Google TV, Yahoo, Boxee and Apple TV.

The most striking announcements came from cable providers themselves. In separate presentations, Sony and Samsung each announced deals with Time Warner Cable in which Time Warner subscribers will be able to receive cable service directly through certain Sony and Samsung Internet-enabled HDTV sets without need of a set-top box. Samsung unveiled a similar deal with Comcast. Read More »