VentureBeat Interviews Roku CEO Anthony Wood

VentureBeat scored an exclusive interview with Roku CEO Anthony Wood, How Roku is Kicking the Cable Industry's Butt & Where It's Going Next.

And if you’ve ever wondered why, for example, you can watch some Hulu Plus shows on your laptop but not on your TV, this is the crux of that issue. Every few years, content creators and cable operators renegotiate the rates that the operators pay to license the content. And if, for example, ABC let Hulu give its users the ability to watch Pretty Little Liars on Internet-connected TVs, the cable operators “will use that fact to pay less during the next negotiations,” said Wood. “Or they’ll take [the content creator] from channel two and put in on channel 638.”

Still, in spite of this seeming stranglehold, Wood said, “The Internet is forcing change. Why is HBO Go around? It’s because of companies like Netflix… and the incumbents realize they have to do a lot more to compete. It’s forcing them to give consumers more choice.”

Tidbits: Wood said that Roku customers now are watching about 12 hours of video on the Roku a week, and after purchasing a Roku, about 20% of Roku customers cut back on cable, and another 20% cancel cable. 

I'm disappointed that they didn't talk more about the interesting relationship between Netflix and Roku.

Comments

[Nick]

The whole "you can watch some Hulu Plus shows on your laptop but not on your TV" thing bothers me to the point that I've never seriously considered Hulu. I've read enough of the FAQs on Hulu's page to know that they're biggest competitor is ThePirateBay but I don't think they're addressing the same issues that piracy addresses (even if they think or claim they are). From the FAQs:

"Why would I watch videos on Hulu.com when I have a larger selection of premium content through pirate services?
"Hulu.com is a free and easy-to-use online video service that legally aggregates premium, professionally produced content. We’re focused on delivering a high-quality viewing experience that requires no downloads and is accessible when, where and how users want."

No Hulu, you don't let users watch movies "when, where and how users want" or your users would be able to access any content available to them on their PC on their Roku player as well. To me, it sounds like Hulu was put together by a bunch of executive types that have no experience with the issues they're trying to address. "Hey, lets make it easier for people to get our content through legal means than it is for them to get it through illegal means. Except, make sure we don't let them do X, and make sure they have to do Y. And don't forget about Z." But they haven't done it even if they think they have. When ThePirateBay starts slapping restrictions on "when, where and how users want", then people will stop pirating (from ThePirateBay at least). It sounds like Hulu is run by a bunch of narcissistic morons who believe they're making life easier for the masses. Well thank you Hulu....but no thanks.

At least that's how I feel when I read the Hulu FAQs page.

[moviegeek]

I had Hulu Plus but cancelled it when they lost "30 Rock" and other shows via TV, most of the new shows Hulu is getting are foreign soap operas which I have zero interest in. I sold out and got cable TV again because Comcast had a special price and no contract commitments.

I had a second generation Roku and I liked it very much, I sold it when I bought my Blu-ray player that is internet enabled. I'm sure Roku will still do well because they are sold at Amazon, Walmart and Best Buy.

[Joe Stuart]

Great article! I have to agree with Anthony Wood when he says, "all the major cable networks and operators will be on Roku". We are at the verge of a big shift in the way we consume media. Unfortunately for he cable networks and operators, those who resist will be crippled by a more open, innovative and competitive environment.

[rjejr]

The way this is worded doesn't get to the heart of the matter -

"And if you’ve ever wondered why, for example, you can watch some Hulu Plus shows on your laptop but not on your TV, this is the crux of that issue."

The question shouldn't be why can you watch some Hulu Plus on your laptop but not your tv. The heart of the matter is - why are there shows on FREE Hulu that I can't watch on PAID Hulu Plus? They are calling it "Plus", and charging $7.99 per month for it, but there are shows you can only see for free. PC vs. tv is a false dichotomy, it's about FREE vs. PAID, and not getting what you pay for.

I still haven't used a free Hulu Plus trial despite having the app on both my PS3 and Wii. I do use free Hulu to watch White Collar and Merlin on my tv hooked up to my laptop, so I do watch it on my tv, I just don't pay them to watch it on my tv. Which is also why in the age of HTPCs the tv/PC dichotomy is stupid.

[WhyRoku?]

Mike, can you figure out why Roku appears to be tracking all of your Netflix viewing activity while using one of their boxes, with no option to turn it off?

[CordCutter]

The main advantage to Hulu Plus over regular Hulu is HD. Regular Hulu is not offered in HD, you must have a Plus account to access it. Also the portability, you have Hulu Plus on tablets and phones. I will agree though, there is much more content on regular Hulu. Hulu, although owned by Fox/NBC/ABC does not "own" the shows (well, not all of them I should say). They have to negotiate rates with the producers. CBS, although not involved with Hulu has the same issues. CBS puts full episodes on its website for such shows as How i met Your Mother & NCIS but not for shows like 2 Broke Girls & Mike and Molly. That's because the studio behind 2 Broke Girls and Mike and Molly don't want it on the web, at all. Warner Bros. TV. They are the single worst studio when it comes to this stance. NBC, part owner of Hulu couldn't stream any Chuck episodes (outside the premiere on their site or Hulu) because Chuck was produced by WB TV and refused to allow it.

The best way to enjoy Hulu/Hulu Plus and cord cutters like myself have been doing this for awhile now is utilize Roku & Playon. I have an HTPC in my main family room, using a Hulu Plus account via the web I get 100% of the regular Hulu content (again, I'm on an HTPC on the web using Firefox) AND I get the content offered in HD because I'm logged in with a Plus account. Then, if I want to watch something on Hulu in my bedroom/secondary family room I get access to all of regular Hulu's library via Playon on the Roku. I do not get HD though via Roku/Playon. Playon is a fantastic service that will also allow you to watch live ESPN3 programming via your Roku along with many other sites. Playon is currently running a deal, 80 bucks for a lifetime license AND a Roku box.

[jbelkin]

His comments about a specific show are not entirely accurate - while it might lose value in syndication, cable telcos have no leverage over Disney-ABC because it owns ESPN and well, ABC also - two rock solid foundations cable UNMOVEABLE/UNDROPABLES along with the other 3 networks plus a handful of cable channels. In theory, small cable networks could be hurt so while his comments on licensing COULD be quasi true - his specific comment holds zero merit and reality today. The bottom line is entertainment is run by lawyers apply their same rules of lawyering to every other decision in their lives - do not ask a question you do not know the answer to ... so they dither trying to figure out if anybody can misconstrue the contract to make more money off of them - because if they say no, it's not as if they are losing any revenue since it's all theoritical.

[Peter Davenport]

I signed up for Hulu Plus and when I realized even with the paid upgrade I had to put up with on screen logos, I cancelled immediately. It's one of the reasons I stopped watching TV 7 years ago and I have to put up with logos with a PAID PLAN?!?! No thanks! But Roku 2 XS does rock! Netflix interface is great and speed connecting is fast. But the best resolution for me in regards to Netflix would go to my game system.

[A Facebook User]

Good article in Marketwatch, too: http://www.marketwatch.com/story/roku-is-in-a-sweet-spot-in-shifting-tv-land-2012-03-06

[Nathan]

I have cancelled cable (gladly). I subscribe to NFLX streaming and Hulu Plus. I look at the two $7.99 charges as what I would spend on a DVR each month through cable. Sure, I can get the shows for free, but now I don't have to drag around a laptop everywhere I go. All of my house TVs are connected to Rokus.

Also, there is also one word which makes Hulu Plus a value: Criterion.

[Mike]

But, anybody can repurpose or buy a used, old or new Mac Mini (or PC mini or any Mac or PC), get a video cable to HDMI adaptor and plug it into your TV and watch Hulu free or; get one of those devices that sends your computer screen wirelessly to your HDTV.
This is about Hulu+ charging and Hulu being free. But it is so bizarre you get LESS with Hulu+. It really makes no sense.
The cable companies and studios are so stuck in the mud. Its all reminds me of the collapse of Kodak. I predict that in about five years, we’ll see some major shake ups and take overs of major networks and studios as the old systems making money will collapse and new ways of making money take over. New ways that, should, give the consumer lower prices, more control, and more selection.
CBS in particular is in grave danger and they have no idea.