Hello to Hulu

When looking at the current events in the media industry, our team at In Medias Res always keeps an eye out for the many ways that media sources are available to viewers. Today, you don't need to TiVo a show in order to keep up with it. At least, not as long as you have Hulu.

Hulu. a website that has been making selected episodes (and sometimes entire seasons) of television shows available to the masses, is jointly owned by Walt Disney Co, News Corps, and Providence Equity Partners LLC. Its owners had decided to put it up for sale. And now... well, if you were dreaming of owning Hulu, your opportunity has passed. Hulu is off the market and will continue under the same ownership.

What's in store for Hulu? It's best put in this interview with Sam Schechner:

According to the Wall Street Journal, the owners are trying to re-draw the lines of their ownership. Imagine the way US, UK, and Russia drew lines around Germany and Berlin after WW2, and the way they designated who would be in charge of what. Well, hopefully, the overall process will be a lot more cohesive than that. The last thing we need is a "Cold War" of online videos!

Still, the owners (Disney, etc.) failed to find a high bidder that would agree with their terms. Dish Networks and Google were the last two serious contenders. Dish Networks was bidding around $1.9 billion and Google, while offering $4 billion, had its own terms in mind. So the whole deal was thrown out, and Hulu stays under the same ownership- perhaps with redrawn lines.

At In Medias Res, we are excited to see what becomes of Hulu in the long run. As they continue to add more and more content and to seek more Hulu Plus subscribers ($7.99/month gives subscribers more access to shows and movies). But it's still possible that it will change hands down the road. The website may be split between more global media giants when the licensing agreements will be renewed in a few years.

Google Ceases to Amaze

Google seems to be getting involved in everything these days. Google recently entered the social networking industry with Google+ and now it seems they will be entering the world of online music stores. Google is now entering competition with Apple and Amazon in a race to create services that combine retail sales and remote music storage. Google's cloud service, Music Beta, and Amazon's Cloud Player both let users store music online, but neither of them have licenses from all the music companies. Due to this, users must upload most of the music that they want stored on their system. Google, though, is talking to three major music companies, Vivendi SA's Universal Music Group, Sony Corp.'s Sony Music and Access Industries Inc.'s Warner Music Group. Music Beta currently allows people to upload up to 20,000 songs. Apple is at this moment leading the race with their recent release iCloud. However, Google's Music Beta is still in an invitation-only testing mode, so we can expect it to become much larger threat to Apple and Amazon.

Apple's Steve Jobs Died

The biggest news in the history of modern technology has come out the past week: Apple’s Steve Jobs died at the age of 56. His death will not only affect Apple as a company but also the media industry as a whole.

There are short-term and long-term effects resulting from Steve Job’s death. Some of these effects will be discussed through this blog post.

The death of a legendary creator is most of the times an advantage to the sales of his creations. This can be applied in any field/industry. Let’s take the music industry for example. The death of the king of pop, Michael Jackson, resulted in a boom in his songs and album sales. The same thing is expected to happen to Steve Job’s iCreations and specially his latest iPhone 4S. People would want to grab the opportunity of owning a device that was created by a legend-to-be.

This affects other competitors in the media industry. Some might have an HP and plan to keep it for another year and then get a new one. But with the Macbooks running out and out of date (with time), they will rush into buying a Macbook Air instead. This influences the sales of HP PCs and other complements such as Windows XP.

Some are suspecting the company’s ongoing success in the long run. At some point, Steve’s modern designs will become old and so Apple is under the pressure of following in his footsteps of creating newer and more unique devices. “In 1985, the company began a steady decline that saw it drift to the margins of the computer industry” all because Steve Jobs was fired. It was only when he came back to the company that it started to rise again in 1997. That being said, some believe that the exact thing will happen to Apple’s sales today.

If this is proves to be true, it will be an advantage to other PC companies and their complements as their devices will rise in demand and therefore have their years of prosperity.

Netflix, Are You Serious!?

Perhaps no other company in the media industry is receiving for attention at this moment than Netflix. 2 months ago, Netflix announced that they would be changing their price, resulting in outrage among numerous customers. Fast-forward two months and the price change has resulted in the loss of many subscribers. Just when current customers thought they couldn’t get any angrier, things got a lot worse. Netflix CEO Reed Hastings recently sent out an overnight email to the company’s 23 million subscribers, notifying them of Netflix’s plan to separate its movie services.

Hastings plans to rename the DVD business from Netflix to Qwikster. Qwikster will have its own billing system, website, and list of movies. Current customers are infuriated by this move. Stating how now they will not only have to play a lot more, but they will also have to access to different sources. Angry customers are even threatening to cancel their Netflix subscriptions, arguing that the selection of titles available for streaming is very limited compared to the DVDs.

In my opinion, things are not looking so great for Netflix’s future. Not only are their fans becoming infuriated, but there is also an increasing amount of movies and videos becoming available throughout the Internet. Netflix’s shares have already dropped 7.3% on Monday according to the Nasdaq Stock Market. Hastings says he is willing to endure through the downfall because his long-term belief is that people will become less dependable on DVDs and eventually streaming will take over and make DVDs obsolete. While Hastings remains confident and envisions a successful future, I for one would not recommend investing in Netflix for a while.

-Nayef Halloun

Social Media Use In Small Businesses

Keeping up with current events, social media is making starting up a new business easier than ever. An article in the Miami Herald shows that while most leading companies have already become accessible through social media, small businesses are just now seeing the potential. The most prominent new frontier opened up to small businesses with social media is advertising. Businesses can keep people up to date with upcoming promotional events and sales. Advertising in newspapers and on TV is extremely expensive, especially for small businesses. As a business gathers friends and followers on media sites, it becomes very efficient for businesses to advertise to this group of people. While most ads in other places would be useless for a majority of the people exposed, advertising to your followers saves money and targets people who would be most likely to respond.

With the use of social media sites by ordinary consumers constantly increasing, new and small businesses are given instant access to more views than ever before than if they had not gone to sites such as Facebook or Twitter.

Lion King 3-D

Let's talk about some current developments: it's been a very busy and lucrative time in the media industry.

An article in the WSJ states that the 1994 movie, the Lion King was re-released in 3-D in movie theatres this week. Up until now, it had grossed 29.3 million dollars topping all other movies in the U.S. Box Office. This is a record in history as it added to the film’s lifetime gross on top of the $40.9 million it made on its opening weekend in 1994, the $765 million earning world-wide and the $19.4 million large-format reissue in 2002.

The idea of transforming a classical movie into 3-D was genius. The statistics in the article prove so as “92% of the weekend's gross came from 3-D ticket sales”. So we can see here, that the marketing media has a huge and evident effect on business.

The movie also had an effect on social media as it gave people something to talk about. According to twitcritics.com, 4140 tweeters mentioned the Lion King 3-D till 06:20 pm September 18, 2011.

It must have affected the publishing industry as well. The WSJ newspaper is writing about it and many other newspapers have it mentioned in their movie theatres page. Each newspaper company must have asked for some amount of money in exchange for a space in their paper. This further expands the flow of money.

Other than newspapers, operators of broadcasting and owners of television stations had to display the movie trailer. This means that they also got paid in exchange for the time period they spent showing the trailer as a form of advertising. The same applies to radio stations.

The movie’s tremendous success did not only affect Walt Disney Co. by earning a huge gross/profit, but it also affected the competing movie production companies by beating them on the box office and by affecting their revenue as well. If some had one opportunity to go to the movies for the weekend, they might choose to watch Lion King 3-D (a number one rated movie) instead of the Smurfs which ranked 15 on the box office.

Not to forget to mention that the movie itself “is largely a promotion for the debut of "The Lion King" in 3-D on Blu-ray disc next month” as mentioned in the article which means that the revenue will not stop here.