Leaked internal memo suggests big changes in store for Hulu

By on August 20, 2012, 12:00 PM

Big changes could be coming to video streaming service Hulu in the near future according to a leaked confidential memo that found its way to Variety. The three-page memo, dated in July, suggests that CEO Jason Kilar could be preparing to leave the company while other bullet points highlight potential service and ownership changes.

The memo doesn’t specifically say that Kilar is out but perhaps instead reflect plans that would come to reality should he leave based on other actions. A management buyout of Providence Equity Partners, one of Hulu’s three large owners, is expected to close in September which could trigger two possible developments described by the publication as “game changers.”

The buyout could allow any Hulu executive with a large number of vested shares to cash out. According to a source familiar with the subject, this could result in a payday for Kilar of roughly $100 million. Of course, it’s all speculation at this point as there hasn’t been a search committee hired to find a replacement nor have any potential candidates been approached.

Second, Providence’s exit could result in a number of changes with regards to content licensing agreements, Hulu’s key asset. This could potentially be more disastrous for the site and its members as it could include eliminating content exclusivity, reducing international reach, adding more commercials and getting rid of current-season exclusivity. The latter would mean that Disney and News Corp. could license programming to other third-party companies like YouTube, effectively watering down Hulu’s competitive advantage.

It’s important to point out that the Providence management buyout isn’t finalized at this point but all expectations suggest it will close next month.

User Comments: 3

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gwailo247, TechSpot Chancellor, said:

All I want from Hulu is to be able to watch network TV shows, after they air, with at most the same amount of TV commercials that I would have to watch if I was watching the show OTA.

So basically replicate a Tivo (or VCR for us old timers)

Scshadow said:

Hulu is going down the crapper. I'm tired of 8 day delays on the fox shows. I want the choice to watch it on air or online but I certainly can't if I'm always behind. And now networks seem to be experimenting with even longer delays or certain exclusions. Eureka's last 7 episodes posted on a month delay. Chuck's final season, never posted at all. I wish I could see a path where service would improve but it seems like hulu and potential future sites like these will be inevitably coerced into being competitive to serve the purpose of the networks.

Beyond this, Hulu has become incompetent. Facebook integration is beyond stupid. They've gutted half the site and linked it to facebook. They're forcing autoplay on you now. I also got a video in my queue today I didn't subscribe for not that it matters, if you're queue is empty then it'll find something to play.

Jim$ter said:

I hadn't watched hulu for a year or so and remembered it worked well. Well recently I tried again and was very dissapointed in the amount and lengths of commercials. So much so I decided to go right to the networks website and watch it without commercials. Sorry HULU but I use to have good thoughts about your service but now I wouldn't recommend you to anyone. Commercials suck and adding more and making them longer makes your service suck. You have to do what you have to do but on my DVR and other services I can skip commercials (which I always do) or they don't have them (Thanks netflixs and other online services). So get with the program...sure have a few commercials on your free service..I recommend like 3 max...up to 30 second commercials spread out would be plenty and offer ad free paid service. I would guarantee you would have a lot more customers if you do that

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