Hulu a leading site that streams premium TV content, announced that its content will no longer be available via Boxee (recently funded by Union Square and Spark).
In a short period of time, hundreds of thousands of people have expressed interest in Boxee's solution, that enables you to view movies, TV programs, etc., streamed from your PC and displayed on your HDTV. In a twist that Hollywood writers would deeply appreciate, it seems as if the warm market response became the ironic problem for this company. Similar to the way Napster, Bit torrent, and other pirates siphoned revenues from content providers, it seems as if the battleground is now shifting to Cable/MSO's. Make no mistake, these folk relish a good bloody fight.
The issue is that, with services such as this (and there are many services such as this), users can stream quality content via one cable connection to many TV's. Adios multiple set top boxes (perhaps, hasta la vista one set top box).Therefore, monthly subscriber revenue, which is much more powerful to these folk than advertising revenue, will be under intense pressure. It's similar to the problem newspapers have; no realistic prospect of replacing home subscription revenue with monetized CPM views. It's the ultimate existential threat to the status quo.
Safe to say, round 1 goes to the cable/content providers here. Nevertheless, the software/internet industry is known for being thrown out the door and coming back through the window. The technology barriers to entry for services such as Boxee are not that large. The question is whether this fight, which is really over 'business' model and legal use, will determine if we see a new generation of pirates, or will there be an accommodation that enables a new generation of legal innovators?
In hindsight, unlike YouTube, which experienced incredible hypergrowth, largely through purloined SNL content, Boxee had an early high profile and was rapidly attacked by the content/cable owners (fool me once shame on you, fool me twice...). No doubt this is a battle to see if the Wolf will survive.