If You Think Hulu Isn’t Taking Over the World, You’ve Not Been Paying Attention

image The “day after” editorial on major movements in tech is almost always fun to watch. Today is no exception, as I’m seeing a lot of delayed reaction from several bloggers on the news of Hulu coming to a wide variety of set top and mobile devices that Kristen and I talked about yesterday.

The prevailing opinion today seems to be that there is no way in hell Hulu, in any way, constitutes a threat to the cable business.

This view, of course, is myopic and stupid.

Peter Kafka, over at MediaMemo today, kicked things off:

If you’re planning on swapping out your expensive cable TV service for Hulu’s $10 a month subscription offering, Jason Kilar has advice for you: Don’t do it!

The Hulu CEO insists that his “Hulu Plus” service, which gives subscribers a deep catalog of shows they can watch on their computers or on gadgets like the iPad, isn’t meant to replace cable. Instead, he says, it’s meant to augment cable. Just like your iPhone doesn’t replace your PC.

And he’s right. Hulu Plus is designed explicitly not to threaten the cable business. That’s why it doesn’t offer any news or sports, and why it only offers shows that air on three broadcast networks and almost nothing that runs on cable networks.

He goes on to explain, light on the details of course, that content providers make oodles of money selling content to cable companies, and thus have no desire to “upset the likes of Comcast.”

Silicon Alley Insider’s Dan Frommer picks up the hand-off from Peter and runs it forward a few more yards with three reasons why Hulu is just plain incapable of walking and chewing bubblegum, let alone posing a threat to the powers that be:

The content selection simply isn’t broad or deep enough to replace cable, unless the ONLY shows you watch are broadcast TV shows already on Hulu. Most people still want to watch most of their TV on their TVs. The cable (or phone) company still runs the pipe into your house. And Comcast, the biggest cable company, owns a big chunk of Hulu. Hulu Plus looks like a great service, and we have no doubt that many people will want to pay for it, especially for iPad and TV access. It’ll be a great complement to cable service, but it’s not going to replace cable for most people.

It’s as if everyone has forgotten that other entertainment options even exist.

In case you’ve forgotten (and you really have no excuse to have forgotten since I went over this ground yesterday in laborious detail), there are a number of other complementary options that exist for bringing entertainment to the average consumer’s living room via the internet. Most of these options are already in place in a large number of consumers homes today.

Dan’s three points were that selection sucked, people wanna watch stuff on their TVs, and that the cable company will always own the pipe into your home.

Let’s rebut these points soundly, shall we?

1) Dan Frommer: Hulu’s Selection Sucks, therefore No One Will Switch.

Hulu isn’t the only service providing on demand video to the mainstream. On almost every single device Hulu is announcing support for, Netflix announced support for it’s live streaming service a few weeks ago. This includes iDevices, the XBox 360, the PS3, and a variety of DVR and smart televisions already available to consumers. Between the two services mentioned, the majority of the content a consumer could want is available to watch. This, of course, excludes premium content from some providers – but even Netflix provides access to popular programming from premium and first-tier cable networks like Showtime, Cinemax and TNT, for instance.

2) People only want to watch stuff on their TVs

I think this point is debatable – I tend to agree with the supposition that the preferred place to watch longform content is in the living room, but I know it’s debatable because every time I make the assertion, there are certain pockets of resistance to that which crop up.

Aside from that, it’s hardly believable that Dan Frommer actually read the press information or even was awake during the day of the launch without knowing that Hulu Plus was launched with support on commonly available DVRs and smart TVs, as well as future support for several game consoles and Blu-Ray players. Assuming he knows that to be true, it’s even further implausible to believe that he doesn’t know that game consoles and televisions are actually in most people’s living rooms already.

3) People will only get broadband from cable companies and phone companies.

Excuse me – have you ever heard of 4G before? I can’t say it more succinctly than I said it yesterday:

The United States lags behind the rest of the world in broadband speeds available to consumers. While countries like Finland, Japan and South Korea regularly deliver 50 megabits bi-directionally to the home as a cheapie, baseline connection, the absolute best baseline plan from the whole lot of you in the USA is 5 to 10 mbs down, and a fraction of that in upload speed. What’s bad is that this is the one area where cablecos and telcos could prove your edge over the new and upstart competition. They’ve acclimated the average American broadband user into thinking barely faster than dialup is the same thing as “super-fast unlimited internet service.”

That’s allowed 4G providers to swoop in and say “Look! We’ll give you 6 mbs down and 2 mbs up! It’s half the cost of what you’re paying now, and it’s wireless!”

People take a look at that and go “Hey! It can’t be worse than what I have now!”

And they’re right.

And there you have it. I’m fairly confident that cable companies and their partners in the telco biz will be smugly self confident that their current offerings are sufficient to carry them through in perpetuity, paving the way for the rise of WiMax.

Did You Expect Hulu’s Kilar to Cop to It?

Kafka gets hung up on the Hulu CEO’s protestations. Of course Jason Kilar says they’re not trying to kill off cable companies – the worst thing Hulu could possibly do at this point in their development is to make any overt and intentional waves. Working with content producers, as a general rule, is a dicey proposition. Working with entrenched distributors and creative companies like Old Media (in all it’s forms) is doubly so.

We’re talking about organizations that have (barely) progressed past the mindset that the internet is no longer a fad. The fact that some idiot at one of the networks or the cable companies hasn’t randomly decided to file a cease and desist, DMCA notice or lawsuit against Hulu is amazing.

Think that’s too cynical of an outlook? Try reading on any given day a random sampling of posts on Mike Masnick’s Techdirt. The tech and New Media culture savvy of most of these companies ranks somewhere below that of your average politician (for more, see: Internet Kill-Switch).

Hulu, on it’s own, isn’t going to change the game. Don’t kid yourself, though, their future plans are betrayed by their past marketing efforts.