Hulu get Boxee'd out [UPDATED]
There's been lots of hand-wringing about Hulu denying its online video programming to Boxee, whose software provides an appealing big-screen interface for shows delivered through the Internet, and to TV.com, CBS' competing online video portal. And because Hulu has given only terse public explanations, there's been a lot of speculation about its motives. I have my own guesses, but the thing that strikes me the most about this situation is how little it changes things online.
Boxee is impressive, yet there are numerous other companies offering ways to bring online video feeds to a TV set. These include hardware players such as Netgear, Neuros, Roku, Microsoft (the Xbox 360), Sony (the PlayStation 3) and, well, seemingly every TV manufacturer. So if Hulu was driven by its content suppliers to drop Boxee because of its compatibility with TV screens, that was a truly futile move.
That's the theory advanced by CNet's Greg Sandoval: the media companies that founded Hulu don't want to alienate the cable TV operators that account for far more revenue than the Web does. Meanwhile, according to the Wall Street Journal, Comcast and Time Warner Cable are seeking to put more cable programming online for subscribers only -- competing with the Boxees of the world by trying to make content scarce online, a strategy that has yet to work in the Internet era.
Hulu has said ...
... that its content providers asked it to dump Boxee, and that's something Hollywood typically does when it thinks a software platform is highly vulnerable to piracy. Boxee does include a Bit Torrent client, albeit one that has to be tweaked in order to find bootlegged videos. As Joshua Martin of Yankee Group noted, removing Hulu (and CBS' shows, which the Eye Network did separately) from Boxee will hardly help on the piracy front, if that was the networks' motive. Instead, the absence of legitimately sourced programs makes it more likely that people will download torrents of "Heroes," "24" and "CSI."
The other point worth noting here is that despite cutting off Boxee and TV.com, Hulu's programming continues to flow through MySpace.com, AOL, Sling.com, TVLoop, First on Mars and Mefeedia, if not more online video outlets. Kevin Chou, CEO of Watercooler Inc. (the company behind TVLoop), said Hulu has been a "very, very positive and encouraging" supplier. According to Chou, Hulu has embraced the superdistribution model, and it honestly seems enthusiastic about outlets that add new layers to the viewing experience, such as TVLoop's social-networking functions.
Hulu also makes its programs available through APIs to anyone who wants to embed them into a website. Boxee could go that route, but it's holding off while it continues talking to Hulu, spokesman Andrew Kippen said. "We're hopeful we can find a solution, but we definitely feel like we're being unfairly singled out. We're no different than your browser in terms of how we're getting the content."
Boxee has about 280,000 users, most of them on Macs, Apple TV set-tops and Linux computers. It recently offered a version of the software for Windows computers by invitation only; when the software becomes freely available, its numbers should swell. Kippen said a recent customer survey found that a stunning 80% were using Boxee to view online programs on a TV screen. One can only imagine what that number will be once Boxee strikes deals to put its software onto game consoles, Blu-ray disc players and other set-top boxes.
At any rate, whatever the reasons behind Hulu's recent moves, they're not appearing to have much impact on its overall distribution strategy. And that's a good thing -- Hulu and its network partners won't attract more viewers by making their content harder to find.
Corrected, 4 p.m.: A previous version of this post identified Boxee's spokesman as Andrew Kibben. The correct spelling is Kippen.
-- Jon Healey