Post #23 – It’s official, Hulu is off the block. Now what?

It should come as no surprise, and a great relief, to faithful readers of Reinventing Media that Hulu has been taken off the market by its owners, Disney and Fox (NBC/Universal is a passive partner). You can read the story here.

Now it’s time for the networks to move ahead to use Hulu to help move TV in the right direction. First of all, Hulu’s commercial policy (usually not more than two at a time with a countdown clock) should be a model for ad-supported TV. Of course, this will require increasing the value of commercial slots by providing better targeting information. Ultimately this has to involve the cable MSOs (like Hulu’s part owner NBC) but Hulu could lead the way. And didn’t Time-Warner Cable express an interest in being a part-owner? They should be, and so should CBS.

Commercial inventory in network shows on Hulu should be sold right alongside ad sales of the shows on broadcast by the individual network sales teams. Note, that doesn’t mean “given away as bonus inventory”. The impressions on Hulu are arguably more valuable than those on regular TV because it can prevent commercial skipping and provide somewhat better targeting. Buttressing Hulu’s ad sales as part of regular network buys will help ease media buyers into accepting all inventory, including on-line, time-shifted and dynamically served slots, as part of the normal buying landscape. This will in turn increase the economic value of TV programming, which presumably will lead to more and better shows. That’s my theory, anyway.

An important part of the equation, as a Comcast exec recently pointed out in a Videonuze panel, is to develop a buyer/seller ad system that can support this complexity. Luckily enough, this comes just as two important ad technology companies have merged and announced their intention to create just such a system. Longtime agency suppliers Donovan Data Systems and Mediabank have merged to create Mediaocean, which says it aims to create a modern system for the new digital world. Given their long standing ad agency relationships, they are well-positioned to do this – if they invest the money.

But Hulu should be right there helping them do it.

One thought on “Post #23 – It’s official, Hulu is off the block. Now what?”

  1. “Disney and Fox didn’t decide to keep Hulu because they couldn’t get the bids they wanted for the streaming service. It was because the bids were so good that they stepped back and reconsidered.” … and …

    “According to one insider on the other side of the negotiation, “The process allowed everyone to reflect on the highest and best use of the asset and align our strategies.” That’s essentially what News Corp. chairman Rupert Murdoch and Disney CEO Bob Iger said on Friday in Sun Valley, which is more than likely where they made the last-minute decision.”
    http://www.thewrap.com/media/column-post/why-disney-fox-decided-keep-hulu-and-how-big-were-those-bids-102906

    Not saying she’s right, but they clearly could have sold it if they wanted to.

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