Big Media Forces Hulu To Pull Shows Off Boxee


Big media is getting more restrictive with its Web video content. Do they just not ‘get’ the Internet? Or are they protecting their real revenue sources — cable TV and broadcast ads?

Tonight’s shocker: Web TV site Hulu says its content providers are forcing it to pull their shows off Boxee, which offers free Web media centre software (mostly used by Mac geeks) that looks a little like cable set-top box software.

Hulu did not specify which of its content providers made these demands. But its partners include both of its old media owners — News Corp. (NWS) and NBC (GE) — as well as Viacom (VIA), etc.

Why might they object? One theory: Boxee makes watching video from sites like Hulu a lot like watching cable. As we noted a few hours ago, Boxee/Hulu means that paying $80 a month for cable TV is no longer necessary for some people. It also means we don’t need to watch TV shows (and ads) live, or even fast-forward through them with our DVR.

Meanwhile, many of Hulu’s content providers still make a significant amount of revenue from cable subscriber fees and network advertising. And they’re not making squat from Hulu’s Web ads. So in a time when Comcast (CMCSA) is reporting a shrinking TV subscriber base and CBS is reporting an 8% drop in TV revenues, old media isn’t totally stupid to protect what they have — especially while Boxee is still small.

The dumb part: Pulling Hulu off Boxee isn’t going to change much. It’s not making cable or network TV more attractive. It’s just making it more difficult to watch Hulu.

Instead of browsing Hulu with an Apple remote from the couch, we have to get up and use the mouse. We’re still not paying for cable TV, and now we’re swearing at old media for making our Web TV experience a little worse. Which Hulu CEO Jason Kilar is smart to note in his blog post.

The maddening part of writing this blog entry is that we realise that there is no immediate win here for users. Please know that we take very seriously our role of representing users such that we are able to provide more and more content in more and more ways over time. We embrace this activity in ways that respect content owners’ — and even the entire industry’s — challenges to create great content that users love. Yes, it’s a complex matter. A tough mission, and a never-ending one, but one we are passionately committed to.

What’s next? It’s possible Hulu’s content providers will change their mind. Or maybe NBC, Fox, etc. will make direct deals with Boxee, going around Hulu. Or maybe Hulu will work on a full-screen browsing app that replaces Boxee. But we somehow doubt that.

What’s guaranteed? Tens (hundreds?) of thousands of Boxee/Hulu watchers — the early adopters that old media should probably be listening to, not pissing off — just got screwed.

The move comes as Hulu pulled its shows off CBS’s We assume the decisions are unrelated.