NBC's new flood of content for iPad throws a wrench into Hulu auction

editor's corner

Jim O'Neil

While Fox has built a wall around its content, and ABC is considering doing the same, Comcast's (Nasdaq: CMCSA) NBCUniversal has taken a different tack, last week making more of its content available in full to iPad users. And the move, said BTIG Research analyst Richard Greenfield, makes the sale of Hulu more difficult.

It also makes it that much easier to do away with that pesky triple-digit pay-TV bill.

NBCU late last week rolled out an enhanced version of its Apple (Nasdaq: AAPL) iPad app that previously had allowed users to view only trailers and clips and some information about shows. The new app not only opens more shows up to full viewing on the iPad, it also fixes a number of bugs and upgrades the app's performance on the tablet.

"We are thrilled to offer our fans full episodes via our NBC.com app," said Vivi Zigler,  president of NBCUniversal Digital Entertainment. "Now the app truly reflects the deep fan experience that we have created online at NBC.com. And our fans are going to love the latest update to the NBC Live app which now offers them more content, better access and a unique social television experience."

But that creates problems for Hulu, Greenfield writes.

"Just as Fox is pushing new content behind an authentication wall with ABC thinking about following Fox's lead, NBC does the exact opposite by providing free access to NBC content on portable devices," Greenfield wrote. "Imagine how the potential buyers of Hulu feel looking at NBC's move, which appears to be a direct attack on the Hulu-Plus subscriber base." After all, why would iPad owners pay $8 a month for Hulu Plus when they can get content from two of the three networks backing the site for free?

The NBC content is pretty solid, with the five most recent episodes of primetime scripted shows available, as well as all the episodes of America's Got Talent and the eight most recent shows from Late Night with Jimmy Fallon.

ABC, since April 2010, also makes its shows available for free on the iPad on what has proven to be one of the slickest iPad apps available.

The question, of course, is why NBCUniversal, whose parent company, Comcast, owns one third of Hulu, would want to create waves? Especially with what are reported to be multiple offers on the table in the $1.5 billion to $2 billion range (and possibly more from Google). And, how does making content available for free on the iPad play into Comcast's TV Everywhere initiative?

The short answer, says Greenfield, is that the new app doesn't play into TVE at all. His explanation? It's all about NBC desperately trying to raise ratings for its shows.--Jim

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