Is charging for Hulu is a video apocalypse or a breath of fresh air?

Neither. Charging for Hulu will cut back on the number of viewers. Free trumps a charge every time. Viewers will seek out the other free video content available legally or illegally.

For those TV networks using Hulu as a distribution channel this flight will be bad. They need to recoup their costs of production. With falling viewership on regular TV and weak financial support from web distribution they’ll trim back expenses, i.e. more experiments like Leno at 10 pm. They’ll have to reach a point where revenue = production costs + profit.

Media professionals like to think that their superior artistic skills and technical prowess are important to audience. We’re finding out if that’s true. Does the audience really care enough about the current standards of broadcast television production to pay for it? Or will low production cost, good enough TV fill the gap? Or will television professionals have to suck it up and work much less?

Stay tuned.

 

 

Wealth of Networks review

“It seems passé today to speak of ‘the Internet revolution’. In some academic circles, it is positively naive. But it should not be.”

Reflection on Media Economics Chapters 7, 10, 11, 13

Concentration:

Hoskins, McFadeyn and Finn in their explanation of market concentration use a chart of concentration ratios for U.S. Communications industries from 1994 which indicate that the four firm concentration rate, measuring percent of market share in TV and Radio stations (CR4) is 60 and the 8 firm concentration rate as 87. Since then we have gone through an even more intent period of concentration led by Clear Channel and its acquisition of multiple radio stations in multiple markets. But there are new kids on the block.