Hulu: An Evil Plot to Destroy the World Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

INTRODUCTION

Hulu is a website that offers its viewers online streaming of movies and TV media and this is done on-demand. This on-demand streaming of videos is ad-supported. The website, since its inception, had focused on trailers, clips, behind the scenes, TV shows, movies and other new media from NBC, Fox, ABC, WWE and other studios and networks. The Hulu website is currently being provided to the users of America, Japan and other overseas territories. The company provides videos that are normally in the flash video format and it provides a range of video qualities to view videos whichever the users choose ranging from 240p to 1080 HD. Web syndication services are also provided by this website for Facebook, AOL, MSN, Yahoo and Myspace.

Jason Kilar became the Chief Executive Officer of the Hulu Venture when this venture began in March 2007. This venture was formed by Yahoo, Comcast, AOL, MSN and MySpace. Jeff Zucker president, CEO of NBC Universal, Peter Chernin, who is the president of News Corp and the CEO of Hulu, Jason Kiler announced the deal to launch this website, However, the name Hulu was launched later in the August os 2007.

The mission of Hulu is basically to provide its users the choice of TV and movies videos where and whenever they want. They want to create an area for content owners, advertisers and users where they get that all what they desire for. The users of this website now can watch at any time of the day and any day of the week whatever TV content they desire to watch. It was in 2008, that Hulu opened the website to its online users. The Hulu website provided its users with free streaming of TV videos and movies. About 100 movies, 200 TV shows were uploaded on the website and about 5million users visited and watched the videos on Hulu. Currently, if we look at the performance of the company, the company is also a good candidate for the issue of shares and goes for an IPO by 2013. It was also revealed in 2010 that the company was to undergo an initial public offering. If the company went for an IPO, the value of the company would have been about $2 billion. The Walt Disney Company had also acquired a stake of about 27% in Hulu in 2009.

The company has also thought to launch the website in Ireland and UK in September 2009. However, the company had then failed to sign any content deals therefore, the company had abandoned their plan looking at the foreseeable future. Lately, in 2014 the company has announced to go under an agreement with South Park Studios. This agreement would be for a period of three years and the South Park studios website would be then powered by Hulu. The strong competitive advantage of Hulu is that it has strong distribution channels. The content of Hulu is integrated in the websites of its different distribution partners. If we analyze the sustainable competitive advantage of Hulu then it is clear that Hulu is good at exploiting opportunities, its sustainable competitive advantage is not possessed by many other firms, also it cannot be easily developed from scratch. However, there are other strategic equivalents of Hulu present in the industry such as YouTube.Therefore, in terms of VRIN framework Hulu’s sustainable competitive advantage is valuable, rare, inimitable but not non-substitutable.

1. Please comment on the Alec Baldwin Super Bowl launch commercial. Do you believe that launching Hulu by advertising on the Super Bowl was a smart strategy? Why or why Not?

Hulu had run a TV ad in the 4^th quarter of Super Bowl. The company for the first time thought to advertise the website through word of mouth advertising. This ad starred the great actor Alec Baldwin. This ad which was the very first television commercial for Hulu, was launched during a game. The actor Alec Baldwin gave a very unusual look to Hulu. He said that Hulu is a website which is actually ran by aliens. The main motive of this website is to spread television to each and every corner and this would turn the brains of all the people in mush.

When this commercial was launched it represented a complete change of strategy for the company to promote and advertise its website. The actor Alec Baldwin was shown as an alien who wants to eat away the mushy brains of people. It gave a funny perception for this entertainment portal as a weapon of mass destruction which was in fact disguised as an entertainment website. The tagline of this advertisement was ‘Hulu: an evil plot to destroy the world.................

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In July 2009, Jason Kilar, CEO of Hulu, debating whether an online aggregator of video needs to move away from purely advertising-supported model, and whether it should participate in the sectoral initiatives for the development and testing of "authentication" technology that could contribute to a subscription or pay per-view model. Case can be seen in the early years of Hulu, a joint venture between News Corp. and NBC Universal, which was initially met with strong skepticism, but quickly became the very famous and popular online business video. Provides detailed information about how the company serves content owners, users and advertisers. Describes the online video space enough also include economic and viewership statistics that allow the rich to discuss viable business models.
Topics include: advertising media, business models, digital technologies, distribution channels, the Internet, online media, television and video.
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by Anita Elberse, Sunil Gupta Source: Harvard Business School 29 pages. Publication Date: October 12, 2009. Prod. #: 510005-PDF-ENG