? Video, Studios and Apple as Negotiator

February 18th, 2009

Hulu’s CEO on shutting down Boxee access to Hulu:

Our content providers requested that we turn off access to our content via the Boxee product, and we are respecting their wishes. While we stubbornly believe in this brave new world of media convergence — bumps and all — we are also steadfast in our belief that the best way to achieve our ambitious, never-ending mission of making media easier for users is to work hand in hand with content owners. Without their content, none of what Hulu does would be possible, including providing you content via Hulu.com and our many distribution partner websites.

I think he’s right — working with the content owners is obviously the only way to get anything done — but the problem is, studios act like idiots when it comes to video. They jerk around Hulu, and even Netflix, setting bizarre conditions for their video to be viewable1, punishing their viewers for wanting to watch their content.

The problem is, studios and record labels are filled with a bunch of idiots, and it takes a big company which can negotiate strong terms to change it.

Apple is that company. Apple’s strong negotiating for music on iTunes created the current relative-freedom we have in buying music online, and made DRM-free music possible.

Apple has, luckily, already completed those negotiations; the iTunes store contains most, if not all, major shows, and they are usually available the day after airing with a large back catalog. There are no annoying restrictions like on Hulu or Netflix — you just buy the show you want to watch.

But that’s the next problem: as I’ve discussed before, TV shows on the iTunes store work exactly the same way music does — you buy each episode individually. But that’s not how people like to watch TV shows. People like to be able to flip back and forth, try new shows, and also watch the ones they really love.

iTunes has the content, which Hulu and Netflix do not. All it needs is a subscription service for TV shows and movies. With a TV show subscription service, where you pay a monthly fee to watch as much TV shows as you want, Apple TV would be an absolute must-have.

Unfortunately, though, implementing a subscription service is difficult to do because it requires more negotiation. But if anyone is positioned to deliver it to consumers, it’s Apple. They’ve done it before.

  1. e.g., the Office on Hulu only has the last 5 episodes, and It’s Always Sunny in Philadelphia can only have 5 episodes up at a given time, period, which is completely inane. []