“The Disney-Hulu content-sharing arrangement may have big implications for a company that neither creates video content nor distributes it free online: Apple,” Cliff Edwards writes forBusinessWeek. “It’s not hard to gauge the impact of the Disney-Hulu deal on Google’s YouTube and CBS, owner of TV.com. Both companies are locked in a battle with Hulu over online video viewers and the revenue from ads that run in conjunction with that programming. The more programming available on Hulu, the more time Web users are likely to spend on that site.”
“And the more popular Hulu becomes, the less compelling Apple’s strategy of renting and selling video content online is, says Gartner analyst Michael McGuire. ‘Over time, perhaps the direct-payment model goes away,’ he says,” Edwards reports. “Now the No. 3 video site behind YouTube and News Corp.’s Fox Interactive Media, owner of MySpace, Hulu stands to convince consumers they don’t need to purchase downloads from the likes of Apple.”
“A deeper foray onto Apple’s turf may be in the works. Industry insiders say Hulu is working on an application for Apple’s App Store that would let iPhone and iPod Touch users stream content to those devices,” Edwards reports.
“For all the firepower being amassed by Hulu, no one is counting out Apple yet,” Edwards reports. “Like Hulu, Apple has demonstrated an ability to attract a large audience. Users downloaded 1 billion App Store applications in just nine months. The company has its own entrée into homes with Mac computers, its Apple TV product, and a growing stable of portable devices capable of receiving, storing, and streaming video.”
Edwards reports, “Apple is working on software and devices that could be well-suited to video… Most analysts also expect Apple to unveil an upgraded iPhone in June, when it has said it will introduce new software dubbed iPhone 3.0. Just as the initial iPhone made mobile Web browsing mainstream, the new iPhone may make it a snap to watch home movies on a handheld. A person familiar with Apple’s plans says it’s simple to record and edit stunningly sharp video with the device—and then wirelessly send it to friends with a few clicks or watch it on the phone’s improved screen.”
“Never mind that Apple CEO Steve Jobs is Disney’s largest shareholder,” Edwards writes. “Hulu’s pact with Disney serves as a reminder that if Jobs & Co. wants to make the splash in online video they appear poised to make, Apple needs to act fast.”
Full article here.