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There is some background to this that is interesting. The reason why the content holders behind Hulu didn't want their content on Boxee was because it came too

There is some background to this that is interesting. The reason why the content holders behind Hulu didn't want their content on Boxee was because it came too close to replicating the television experience. While the advertising was kept in place, it still doesn't attract the rates that normal television does. Given a choice, content holders definitely prefer viewers to tune into ordinary broadcast television to watch their shows - online content is about capturing the potion of viewers who miss shows and don't watch broadcast television. With Boxee, there is the potential that the online content will cut into the broadcast TV audience - hence this decision. What is interesting is that the true motives are now more obvious. Online content, in the form of both iTunes and Hulu, is fine as long as it doesn't cut too close to the broadcast base. Content holders have gone from vigorously defending their network broadcasts to now accepting online content, but only to a point. The next battle will take place when more intelligent PC-like DVR's come out on the market (like the PS3, but at a $100-150 price point) allowing viewers to easily stream online content to a television with a remote. The content owners have a short time window between now and then where they have the best of both worlds - both broadcast and online, but once it all goes online the very lucrative and protected broadcast market will be threatened. With online, there is no more having to acquire broadcast licenses, no more large-scale infrastructure networks to reach your potential audience and no longer limited competition and cable monopolies with packaged channel selection.

nikblack 18y ago
Further, here is a comparison of CPM rates and revenue for a typical TV episode. Network TV: $20-40cpm per ad - 15-19 ads shown in 30 minutes Cable: $1-15 cpm per ad - 10-22 ads shown (plus subscription revenue) iTunes: $0.80 per viewer, so CPM of $80 total (est network share) Hulu / Online: CPM $10-40. 1-4 ads per show. If you do the math, its obvious that network broadcasts really rake it in. A 30 second spot on a prime time network show sells for anywhere from $400,000 to $800,000 per spot (for 15-30M viewers). If everyone started watching Hulu instead, they would lose 80-90% of revenue. If everybody downloaded on iTunes (assuming 3 viewers per download, or more is likely) they would still lose out but not as much. The problem is if the networks start offering a la carte shows for $2 a pop, they lose the bundling revenue (ie. channels you receive in a bundle but would never pay for on their own).
- brent 18y ago
  First, thank you for providing actual numbers.... but... Supply and demand. If everyone started watching on Hulu they would be able to charge more per advertisement. These are rates given the current situation, not the future. Why do I say this? I watch Hulu. I do not watch TV otherwise. If the advertisers (and networks) want my eyeballs they need to provide content via Hulu.
  - krschultz 18y ago
    Those numbers or per thousand so it doesn't really matter I would think. Personally I would think that the Hulu ads are more valuable than the TV ones because it is 1 advertiser per show and there is less signal to noise for the viewer. When I watch football on Sunday it is sponsored by Ford, Toyota, Miller, Budweiser, Verizon, and 10 other companies I will never remember or care about. When I watch the Daily Show on Hulu it is 1 company a few times and actually leaves an impression.
ja2ke 18y ago
Seems like the solution would be to embrace Boxee and then raise your advertising rates because you've now got TV audience eyeballs watching Hulu content instead of Firefox-window eyeballs. I guess it's at that moment that you notice the whisps of steam rise from the snout and the lazily opening eye, and realize that Comcast over in the corner was never asleep at all, but saw the whole thing. ... oops somehow I failed to notice a 4 hour old reply saying the same thing. Apologies.

nikblack 18y ago

Further, here is a comparison of CPM rates and revenue for a typical TV episode. Network TV: $20-40cpm per ad - 15-19 ads shown in 30 minutes Cable: $1-15 cpm per ad - 10-22 ads shown (plus subscription revenue) iTunes: $0.80 per viewer, so CPM of $80 total (est network share) Hulu / Online: CPM $10-40. 1-4 ads per show. If you do the math, its obvious that network broadcasts really rake it in. A 30 second spot on a prime time network show sells for anywhere from $400,000 to $800,000 per spot (for 15-30M viewers). If everyone started watching Hulu instead, they would lose 80-90% of revenue. If everybody downloaded on iTunes (assuming 3 viewers per download, or more is likely) they would still lose out but not as much. The problem is if the networks start offering a la carte shows for $2 a pop, they lose the bundling revenue (ie. channels you receive in a bundle but would never pay for on their own).

brent 18y ago
First, thank you for providing actual numbers.... but... Supply and demand. If everyone started watching on Hulu they would be able to charge more per advertisement. These are rates given the current situation, not the future. Why do I say this? I watch Hulu. I do not watch TV otherwise. If the advertisers (and networks) want my eyeballs they need to provide content via Hulu.
- krschultz 18y ago
  Those numbers or per thousand so it doesn't really matter I would think. Personally I would think that the Hulu ads are more valuable than the TV ones because it is 1 advertiser per show and there is less signal to noise for the viewer. When I watch football on Sunday it is sponsored by Ford, Toyota, Miller, Budweiser, Verizon, and 10 other companies I will never remember or care about. When I watch the Daily Show on Hulu it is 1 company a few times and actually leaves an impression.

ja2ke 18y ago

Seems like the solution would be to embrace Boxee and then raise your advertising rates because you've now got TV audience eyeballs watching Hulu content instead of Firefox-window eyeballs. I guess it's at that moment that you notice the whisps of steam rise from the snout and the lazily opening eye, and realize that Comcast over in the corner was never asleep at all, but saw the whole thing. ... oops somehow I failed to notice a 4 hour old reply saying the same thing. Apologies.