December 17, 2012
Hulu CEO Jason Kilar is having a good year - at least, to hear him tell it.
In a blog post yesterday titled "A Big 2012," Kilar bragged that the popular online TV hub had topped 3 million paying customers for its Hulu Plus service - more than double the figure from a year ago. At a cost of $7.99 a month, that would have Hulu Plus earning around $288 million a year in subscription fees. The premium service started in November 2010 with about 500,000 users. The growth in subscribers helped Hulu on the ad front. The company said its ad revenue jumped 65 percent, to $695 million this year. Kilar also boasted that Hulu had increased the amount of content available through the service by 40 percent.
Hulu wouldn't comment on its programming costs for 2013. Last year it said it would spend $500 million on shows. Netflix content costs by comparison are about $2.1 billion a year. "Hulu should be judged on revenue and profitability like every other company," said Dan Rayburn, a streaming media expert with Frost & Sullivan. "We don't know what they spend on content acquisition." The five-year-old service offers shows from broadcast and cable outlets. It is owned by Comcast, Disney and News Corp., which also owns The Post. The firm Providence Equity exited its Hulu investment in October, pocketing $200 million on its $100 million investment. New York Post
Entertainment company Participant Media, one of the backers of the hit historical drama "Lincoln", will launch a cable TV network next summer with programming that focuses on social issues of interest to the millenials generation of teens and young adults. The channel's original programming, films and documentaries will be aimed at viewers age 18 to 34 in the large demographic group known as millenials, Participant Media CEO Jim Berk said in an interview on Monday. Millenials are particularly interested in the type of content that Participant produces about social issues, Berk said. The studio's credits include the current release "Lincoln", about President Abraham Lincoln's push to ban slavery, last year's civil rights drama "The Help" and Al Gore climate change documentary "An Inconvenient Truth".
Participant Media is creating the new network by purchasing two existing cable channels, The Documentary Channel and Halogen TV. After those networks are combined and rebranded, the new channel will reach an estimated 40 million of the more than 100 million U.S. pay-TV subscribers. The company, founded by billionaire and former eBay Inc President Jeff Skoll with the aim of producing entertaining content that inspires social change, interacts regularly with more than 2.5 million people through social media, local movie screenings and its Takepart.com website, Berk said.
The challenge for Participant will be to sign up additional pay-TV distributors and win viewership in a crowded media landscape. The company is privately held and is not part of a large media conglomerate. "We have the funding necessary to take a very long-term view, and to spend what we need to spend in terms of programming," Berk said. The mainstay of the network's lineup will be original programming from a variety of genres, said Evan Shapiro, a Participant executive who will run the new network. The company is developing programming with established Hollywood names including former MTV President Brian Graden, "Inconvenient Truth" director Davis Guggenheim and documentary filmmaker Morgan Spurlock. Participant also hopes to work with pay-TV distributors to make the channel's content available on mobile devices such as smartphones and tablets, to meet the viewing patterns of younger audiences, Shapiro said. Reuters
Twitter Inc. said Monday that it is tying up with TV ratings giant Nielsen Co. to create the "Nielsen Twitter TV Rating," a new audience metric based on the popular microblogging service. The move seems to be a natural extension for Twitter. The short-messaging service has become particularly useful when it lights up in real-time during notable TV events like a presidential debate, say, or even a benefit like the recent music extravaganza held to help victims of Hurricane Sandy-when it was used to monitor perception of the Rolling Stones's performance. This so-called second-screen phenomenon often plays out as a Twitter user watches the tube with a mobile device or tablet in hand.
Nielsen said in a statement that the new Twitter TV Rating will be used to gauge "the reach of the TV conversation on Twitter," and will start in the fall 2013 TV season. The new metric will complement current TV ratings, and will give "TV networks and advertisers the real-time metrics required to understand TV audience social activity," Nielsen said. Twitter head of media Chloe Sladden wrote on the company blog that "our TV partners have consistently asked for one common benchmark from which to measure the engagement of their programming." "This new metric is intended to answer that request," she added. Twitter is in the midst of dramatic growth, and its ability to translate its vast audience into vast amounts of revenue is sure to come under increasing scrutiny as it moves toward a potential initial public offering. That is particularly true in the wake of several IPOs among Twitter's peers that have turned out to be less-than-enticing for many investors, such as those staged by Facebook Inc., Zynga Inc. and Groupon Inc. Wall Street Journal
Nielsen is buying Arbitron for about $1.26 billion. The radio audience ratings company will give Nielsen a clearer picture of unmeasured areas of media consumption like streaming audio. Nielsen Holdings N.V. provides global data about what people watch and buy. The company said Tuesday that it will pay $48 per share, which is a 26 percent premium to Arbitron's Monday closing price of $38.04. Arbitron Inc., based in Columbia, Md., currently has about 26.2 million outstanding shares, according to FactSet. The acquisition is expected to add about 13 cents per share to Nielsen's adjusted earnings a year after closing and about 19 cents per share to adjusted earnings two years after closing. The boards of both companies have approved the deal. Nielsen has headquarters in the Netherlands and New York. Bloomberg
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