I haven't read all of the comments around this topic as I simply don't have the time, but might this be about Boxee not having the systems in place to allow Hulu to properly pay local affiliates a portion of the revenue generated from commercials? Or perhaps Hulu doesn't want to pay out a portion to local affiliates?
I appreciate Fred's argument re: it's just a browser, but Boxee is optimized and intended for watching on a TV. If people are watching Boxee shows on their TV, then they're not watching and/or DVR-ing the local affiliate versions which might have local advertising, etc. (true that most DVR people skip commercials, but some don't). Thus local affiliates could argue that Boxee makes Hulu a direct competitor for their local TV viewing audiences. I would argue, naively, that this is why you don't see nation-wide NBC, FOX, and CBS channels on your cable box -- because it would cannibalize affiliate revenue. But that, in effect, is what Boxee is creating.
I wonder if it would make a difference if Hulu were share revenue (or more revenue as the case may be) with local affiliates and put systems in place to allow affiliates to insert local advertising into shows based on a Boxee user's location.
This, of course, doesn't matter for CNN, for example, because all of the money goes into a single pot: The CNN pot. But that's not true with NBC, Fox, etc. I don't think. Correct?
The one hole in my theory is AppleTV -- you can buy broadcast shows on Apple TV, but perhaps the fact that they're commercial-free somehow makes a difference or gets around a contractual obligation.
Boxee is under no obligation to pay local affiliates. Hulu clearly has the geolocation ability to make that happen, if they really wanted to. All that Boxee does is provide a specialized Web browser that happens to be more useful than Firefox when using a big-screen TV with your computer. They don't circumvent Hulu advertisements or anything else, and there is nothing preventing people from just using Firefox with their big-screen TV instead. The content providers are wrong in this issue, plain and simple.
For the last time, they need to stop treating everything new as a threat to their old revenue streams.
I think it was made pretty clear, that Hulu does embrace boxee, but it was the content providers that pulled the plug. Without content from the providers there would be no Hulu, so they had to cave.
This warrants repeating: Hulu is doing their very best to drag the content providers into this century. Boxee gets this, which is why they complied with a request from Hulu, without forcing the issue. Hulu asked, Boxee agreed, and now Hulu tries to convince content providers to change their mind.
I think boxee and this VC are obfuscating the important point that Hulu's content providers and its owners are one in the same. Hulu is jointly owned by NBC Universal and News Corp (owner of FOX and 21st Century Fox). So, in the end, neither the stockholders nor the stakeholders support Boxee.
This is no surprise; why should they want to nurture a less lucrative distribution channel on the same medium as their primary source of revenue?
There's a reason why content providers don't embrace Boxee. NBC and Fox control Hulu. That makes it safe. Hulu won't start showing programming outside of what the major content creators make. Boxee, with its open philosophy, would welcome high-quality non-establishment content. If people get into the habit of using Hulu, they don't have to compete with new content creators. If people get into the habit of using Boxee, lots of people could start creating content and having access to the same distribution channel. That's dangerous for the studios who like to have near-monopoly conditions for their content.
I didn't say it was a good reason, just that it was a reason.
I appreciate Fred's argument re: it's just a browser, but Boxee is optimized and intended for watching on a TV. If people are watching Boxee shows on their TV, then they're not watching and/or DVR-ing the local affiliate versions which might have local advertising, etc. (true that most DVR people skip commercials, but some don't). Thus local affiliates could argue that Boxee makes Hulu a direct competitor for their local TV viewing audiences. I would argue, naively, that this is why you don't see nation-wide NBC, FOX, and CBS channels on your cable box -- because it would cannibalize affiliate revenue. But that, in effect, is what Boxee is creating.
I wonder if it would make a difference if Hulu were share revenue (or more revenue as the case may be) with local affiliates and put systems in place to allow affiliates to insert local advertising into shows based on a Boxee user's location.
This, of course, doesn't matter for CNN, for example, because all of the money goes into a single pot: The CNN pot. But that's not true with NBC, Fox, etc. I don't think. Correct?
The one hole in my theory is AppleTV -- you can buy broadcast shows on Apple TV, but perhaps the fact that they're commercial-free somehow makes a difference or gets around a contractual obligation.