updated 09:15 pm EST, Thu February 3, 2011
Hulu exec could be forced out for defiant speech
Hulu's chief executive Jason Kilar might be removed from the top spot for a post that challenged traditional TV from studios. A News Corp executive said on Thursday that the Internet video maven would very likely be forced out as Comcast-NBC, Disney and News Corp's Fox are upset that he would criticize their TV business. The SAI tipster suggested Kilar was aware of it and was risking a 'poison pill' gesture that would lead to retaliation.
Anonymous executives at the studio had already reacted with spite, arguing that he was spoiled and not connected to the reality they saw, where the majority still watched TV. His writings were the "musings of an elitist" who didn't understand how insignificant Internet viewing was, one unnamed studio source said.
None of the involved companies have commented on the subject.
Among Kilar's criticisms angering the studios were beliefs that regular TV had too many ads and that the ads themselves were half as effective as the web ads in between Hulu segments. Most TV ads were targeted against wide demographics and often missed the real audience when Internet ads could be much more precise. Kilar noted that the approach of simply loading up more ads on cable or satellite often led to more ad skipping with DVRs and actually hurt the business, even with ads forced in.
He also reiterated some of the advantages of Hulu that conventional TV couldn't match, such as the ability to watch on a phone or tablet and that they didn't have to watch at an arbitrary time. Hulu was very likely to upset traditional TV and drive profits down, he said, arguing that his company was replacing traditional TV rather than just supporting it.
"A number of you that are reading this might be thinking that we’d have to be crazy to think that our small team can actually re-invent television and compete effectively against a landscape of distribution giants like cable companies, satellite companies, and huge online companies," he wrote. "We are crazy. All entrepreneurs need to be."
The war of words reflects an increasing tension between legacy TV providers and Internet services that has in some cases led to open attacks on each other's medium. Time Warner has regularly been an enemy of Internet video and briefly trialled low bandwidth caps on cable Internet to discourage video use; its CEO Jeff Bewkes has also insisted that Netflix is too cheap and insignificant even as he took steps to discourage it. Many studios now block Google TV from accessing the web since they see it as encouraging users to drop lucrative cable deals.
Hulu has often had to impose blocks of its own on free service at the request of the studios that have a controlling stake, such as on apps from Boxee and Hillcrest. Hulu Plus' paid nature has let it often circumvent those blocks and give users a cheaper, though not free, alternative to regular TV or even pay-per-show Internet service like iTunes and Amazon.