We’ve seen in the past year that Hulu gets testy about their video content being used on other sites or platforms, with Boxee and TV.com both forced to remove Hulu content from their sites and applications. Now startup Rippol is facing the same fate.

Rippol just publicly launched their video discovery sites at yesterday’s Real-Time CrunchUp, which combines both complex algorithms with user suggestions to surface interesting video content.

Less than a few hours after Rippol launched, the startup’s co-founder Aaron Crayford received notice from Hulu that the video embeds on Rippol from Hulu were in violation of the terms of service which state that embeds are for personal, non-commercial use only. While Rippol says that they won’t place ads in the videos or around the videos, Hulu says that the simple fact that Rippol plans to make money from the entire content service violates the TOS. Instead, Hulu offered Rippol the ability to us its site map, which is a feed that links back to Hulu for video playback. Don’t embed, says Hulu. Link instead. Here’s the email notice:

We saw that you launched today. We want to notify you that you are using our embeds in violation of our terms of service which state specifically that embeds are for personal, non-commercial use only. As such we will plan to block embedding from your site by 12/4. Typically we disable embedding immediately but given that you just launched, we want to give you some time to transition.

In the place of the embeds, we can offer you is a site map feed that links back to Hulu for video playback and includes several useful pieces of metadata in a feed. It includes video titles, descriptions, thumbnails, video type, duration info, season number, episode number, air date, expiration date, in addition to the video link on Hulu.com.

It is updated every few hours: http://www.hulu.com/video_sitemap.index.xml

When Rippol responded that they will never put ads in or around Hulu content, Hulu responded:

Ad placement would be more relevant to the “non-commercial” part of the TOS vs. the “personal” part. While you may not plan to place ads near our content, Rippol is a commercial business in the sense that you plan to make money from the content service you create. Thus our content on your site is being used for commercial purposes, even if it is indirect (i.e. you attract users with Hulu content but only monetize other content).

Note we are not singling out Rippol as we have transitioned other premium video aggregators to our site map feed.

Rippol looks at your video watching activity on the site, as well as that of your friends and people in your demographic. It also looks at meta data from video content ingested from sites like YouTube and Hulu, and uses machine learning to identify videos it thinks you’ll like. Naturally, some of the TV shows and movies that surface on Rippol are from Hulu.

Boxee encountered a similar issue in February. Boxee’s software package converts computers, Apple TVs and other popular products into media centers, and integrated Hulu content. But this ended abruptly in February when Hulu’s studio content partners demanded that Boxee take down all videos pulled from from Hulu. TV.com suffered a similar fate when Hulu pulled the plug on content earlier this year, although CBS Interactive, which owns TV.com, vehemently argued that they were within their rights to stream Hulu content.

The thing is that Rippol, and perhaps other video sites like Boxee, may be willing to enter into a distribution agreement with Hulu with regard to embedding content. In Hulu’s note to Rippol, the representative stated that “the only way for a company to legitimately embed our videos the way you do is to enter into a structured distribution relationship with us. However, we are currently entering into these very selectively.”

When Hulu axed the Boxee integration, CEO Jason Kilar wrote in a blog post:

Our content providers requested that we turn off access to our content via the Boxee product, and we are respecting their wishes. While we stubbornly believe in this brave new world of media convergence — bumps and all — we are also steadfast in our belief that the best way to achieve our ambitious, never-ending mission of making media easier for users is to work hand in hand with content owners. Without their content, none of what Hulu does would be possible, including providing you content via Hulu.com and our many distribution partner websites.

Our mission to make media dramatically easier and more user-focused has not changed and will not change. We will not stop until we achieve it and we are sober in our assessment that we have such a long way to go.

The maddening part of writing this blog entry is that we realize that there is no immediate win here for users. Please know that we take very seriously our role of representing users such that we are able to provide more and more content in more and more ways over time. We embrace this activity in ways that respect content owners’ — and even the entire industry’s — challenges to create great content that users love. Yes, it’s a complex matter. A tough mission, and a never-ending one, but one we are passionately committed to.

Even before Hulu launched the site had announced partnerships to embed content with AOL, MSN, MySpace and Yahoo. The site also has a partnership with Comcast’s Fancast . And the site also recently launched the ability to watch some video content its video content on its Facebook page.

It’s clear the Hulu is at the mercy of of studio content owners who are calling the shots on partnerships and who should be allowed to embed Hulu content. Kilar is correct in saying that Hulu’s strategy of limited partnerships is not a win for users. But the other party left out here are the developers and startups, like Rippol and Boxee, which are crating innovative and useful products that provide a creative way to watch their videos and even drive traffic to Hulu.

When Hulu was announced in 2007, NBC Universal CEO Jeff Zucker said that Hulu would aim to have “ubiquitous distribution.” The press release issued at the time said that Hulu “will actively seek agreements with a variety of additional distribution partners.” The release also stated that each “distribution partner will feature the site’s content in an embedded player customized with a look and feel consistent with each site, making the offering organic to each destination.”

Clearly, when Hulu was announced, the ambitions were to have many more partnerships to distribute the site’s content. But all signs have pointed to the fact that Hulu and its content partners are simply not open to startups and smaller sites who have new innovations to video consumption. Frankly, it’s disappointing for the developer community as well as consumers.

In the meantime, Rippol’s Crayford says that most of Hulu’s content is available on the content owners sites, which means Rippol will point crawlers to a lot of different domains instead of Hulu, which is tedious (TV.com does this).

When we asked Hulu about the Rippol situation, they responded:

Thanks for the heads up. I’ve been told our folks are in communication with Rippol on how to possibly work together.

The basic policy on our embeds is that we do not allow sites to host the entire Hulu content library without a formal distribution agreement. These agreements are evaluated on a case by case basis with the involvement of content owners. Alternatively, we provide a video site map to allow publishers to link to our videos.

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Microsoft announced another down quarter this morning. Revenues in the September quarter were down 14 percent to $12.92 billion, and net profits declined even further to $3.57 billion, or $0.40 a share. The consensus estimate was $0.32, so Wall Street is happy and the shares are rallying (up 10 percent in early-morning trading).

Investors will forgive the poor performance coming out of the recession (are we out of that yet?), because they hope that yesterday’s launch of Windows 7 will bring back the shine to the stock. If you look at revenues for the Windows business, it certainly looks like both businesses and consumers have been delaying purchases and upgrades in anticipation of the new operating system. The Windows business saw revenues decline by 37 percent, or $1.7 billion, from last year, to $2.6 billion. The closely-related Business division, which includes Office, was down $500 million in revenues, to $4.4 billion.

Microsoft needs to revive these franchises with Windows 7 at a time when it is increasingly under attack by cloud-based productivity apps from Google and others. But Windows 7 should give Microsoft some cover as corporations go through their robotic upgrade exercises. The company recorded $1.5 billion in deferral revenue associated with Windows 7, which pretty much covers the gap from last year.

The two businesses which held steady in terms of revenue were Servers and Tools ($3.4 billion) and Entertainment ($1.9 billion). Microsoft sold 2.1 million Xboxes in the quarter, and is no selling an average of 8.7 games per console, more than any other videogame console. Profits nearly doubled to $312 million, and Xbox Live revenues grew more than 50 percent, although Microsoft does not specify the absolute number.

Looking at Microsoft’s online business, once again the loss in that business ($480 million) was almost the same as its revenues ($490 million), which implies that it is actually losing twice as much as it is bringing in. We saw the same trend last quarter, as Microsoft continues to invest heavily in this business via Bing and other products. Online advertising revenues were down 3 percent (at least that was better than Yahoo’s 12 percent decline), and search ads from Bing saw a “mid single digit” increase.

Below is a table breaking down Microsoft’s revenues by operating division (click to enlarge):

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VEVO has just announced a ’strategic’ investment was made by Abu Dhabi Media Company (ADMC), a giant of a media company with headquarters in Abu Dhabi, capital of the United Arab Emirates, reports MediaMemo. The specifics of the deal remain under cover, but the rumor mill suggests the company is being valued at around $300 million.

Slated for launch in the U.S. and Canada next December, VEVO is going to attempt to leverage YouTube’s massive audience to build a destination and syndication network for “the very best in top-notch music video content”. The three founding shareholders will be sharing the revenue from the music video site with YouTube as it will be using Google’s video sharing site as its main distribution platform.

Question is: how attractive will the service turn out to be considering the fact two other majors, Warner Music and EMI, are still holding out? And how did Abu Dhabi Media Company come into play?

ADMC was created in June 2007 as a joint stock company (wholly owned by the government of Abu Dhabi) from the assets of Emirates Media Incorporated. The company owns a host of television and radio networks and multiple newspaper and magazine businesses.

The company boasts dozens of partnership and distribution agreements with media companies from around the globe, including Bertelsmann, Warner Bros., Participant Media and National Geographic. Its CEO is veteran media pro Edward Borgerding, who was Executive Vice-President of Walt Disney International in Hong Kong before joining ADMC in 2007.

ADMC Chairman H.E. Mohamed Khalaf Al Mazroui in a statement said the deal will help the company establish a leading position in the digital media industry, and added that taking a stake in the joint venture is part of an integrated approach to expand its global presence and brand portfolio.

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At launch Labs’ most exciting (and surprising) new feature was Hulu Desktop — a downloadable native client available for both Mac and Windows that sports a new interface that allows users to sit back from their screens and navigate the site using either their Mac or Windows Media remotes. And today, it’s launching support for Linux. To be perfectly honest I did a double take when I heard the news — plenty of software never makes it to Linux at all, much less a few months after making its PC/Mac debut. But Hulu says that a Linux version was among users’ top requests, so they built it.

The second new feature to launch today is Publisher Tools, which is designed to help bloggers and site owners quickly find content on Hulu that they can embed on their own sites. Upon launching Publisher Tools Hulu will intitially present you with a list of popular video clips, which is what most people are after. There’s also a search feature that lets you search Hulu for content hosted both on the site and the 100+ third party sites that Hulu indexes for premium content (these include MTV, TMZ, and funnyordie). To use the new tool you simply check off which videos you’d like to embed in your site, and Hulu will generate a custom playlist including each clip that you selected.

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A large number of web services are geographically restricted, such as Hulu, Pandora and Spotify. The reasons are usually to do with content licensing restrictions, or because US visitors (or visitors from other advanced economies) are of a higher value from a monetization perspective. A web application can only guess at the location of a visitor based on an IP address and other information, such as browser language and regional settings.

IP addresses are mapped to countries (and in some instances, further to states and cities) using large commercial datasets such as GeoIP from Maxmind, which is a ‘best guess’ database based on data it has collected (how, I would rather not know). The system is accurate enough to enable services to block on a country level, but often fail at a more local level.

But the nature of the web means that geographically restricting web services is next to impossible, because those who are technically adept have known how to find and use proxy servers (both open and private) and VPN services to masquerade as being from another country.

The demand for such services has become so popular that more apps are being released that make this process almost as easy as installing any other application – one-click VPN/Proxy install and then pick a country you want to be surfing from (default USA). Even better, there are now VPN solutions available for free – some of which are outright free, others which are ad supported.

If you find yourself outside of the USA and wanting to watch Hulu, outside of the UK and wanting to checkout the BBC, or wanting to rig a web poll, here are some tips:

Proxy Servers

Easy to find, easy to setup. Some sites have become smart enough now to check if the IP address you are coming in from is an open proxy server and will attempt to deny it – but this is most often the easiest solution. The key is to find an open proxy server that everybody else, or even worse, Eastern European crime syndicates, are also not using.

The best source if you are a blogger is to check your spam comments. Most of those IP addresses will not only be open proxy servers (you just have to work out the port – or if you host your own blog, start logging the port), but will be virgin proxy servers.

Otherwise there are a ton of lists available online, often updated each minute, as well as services where you can test your proxy.

FoxyProxy is a Firefox plugin that allows you to easily switch between proxy servers (many Chinese web users are very familiar with having to juggle proxy servers and use such plugins, or browsers that have similar features built-in)

VPN Servers

Similar to a proxy, except that a VPN is an encrypted link to a server that will route all of your network traffic (your computer, in effect, becomes part of the network).

FreeVPN – thefreevpn.com – A completely free VPN client and service for Windows machines. No ads, and a fast service. Not sure what the business model is, which is why I wouldn’t trust it with any personal or private information and restrict it to just movie watching or poll rigging. Best free VPN service and super easy to install (see review here)

Feeedur - www.freedur.com – A commercial VPN/anonymizing service that works well.

HotSpotShield – hotspotshield.com – Another free VPN service, but forces you to click on an ad. Working with Hulu again.

UltraVPN – www.ultravpn.fr – cross platform (OS X support). Both free and anonymous.

The Web Is Flat

Using a proxy or a VPN to bypass geographic restrictions or to preserve anonymity online has been known and used by more advanced users for years. More modern services and tools are making it easier for the average internet user to take advantage of the same techniques.

There are entire business models that depend on geographic targeting, so there is a constant cat-and-mouse game between providers of these services and those seeking to bypass the set restrictions. Those who are seeking to access content are winning though, and they will continue to win, as the very nature of the Internet and web make it near impossible to detect where somebody actually is if they refuse to let you know.

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There is no love lost between CBS and Hulu. You won’t find any full episodes of CBS shows on Hulu, and CBS’s own site TV.com is so similar in look and feel that one might call it a product of envy. So it should come as no surprise that the knives are still out for Hulu at CBS Interactive.

An email with an article critical of Hulu from CBS Interactive CEO Quincy Smith that was passed around internally (excerpted below) landed in our inbox. Smith confirms that the email is real. Earlier today, he passed along an article from Contentinople titled “Execs Rip Hulu for Giving Away Content” which quotes media executives on a panel laying into Hulu for giving away TV shows for free. The panelists in the article also praise the cable industry’s proposed TV Everywhere model which will make TV shows and movies available online only to consumers who are already existing cable TV subscribers and can be authenticated as such.

Smith passed along the entire article to his executive team, along with a note wondering “how hard it would be to prove that some ratings declines are a result of reckless hulu streams.” CBS’s ratings for the Fall Season premiers have been doing relatively well, compared to other networks. The implication Smith seems to be making here is that maybe the other networks are down because their audience is going online. If he could prove that, it would make his strategy of shunning Hulu look smart.

But he then writes that “Authentication is a nice option.” And his SVP Anthony Soohoo later chimes in: “Authentication will play a huge role in 2010.” Hulu itself may add subscription and pay-per-view options to its service, according to Ruport Murdoch. Smith also mentions some “findings” that support “packing more ads” in online videos.

So what can we conclude from all this? CBS will either be more conservative with its full streams online, or pack them with more ads. Maybe that is what the findings are all about, that online audiences will tolerate more ads for quality content. It is certainly easier to put more ads in online videos than to try to put up an authentication wall (which is really just a pay wall by another name).

Here is the email except (the only thing I didn’t include is the full text of the Contentinople article which you can read at the link above).

From: Soohoo, Anthony
Subject: FW: hulu pricing
Date: September 24, 2009 8:26:44 AM PDT

fyi. Authentication will play a huge role in 2010.
——————————————-
From: Smith, Quincy
Sent: Thursday, September 24, 2009 8:23 AM
To: Soohoo, Anthony; Ashe, Neil; Lurie, Zander; Marquez, Michael; Cain, Sarah
Subject: hulu pricing

Nice way to put it.
We should think about how hard it would be to prove that some ratings
declines are a result of reckless hulu streams and that Authentication
is a nice option
We should also think about if we want to talk the walk on packing more
ads and our findings thus far.
-q

——————————————-
Execs Rip Hulu for Giving Away Content . . .

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While there are no shortage of video search engines out there, Clicker believes its offering is superior because it creates a structured database of programming, organizing shows by things like network, genre, and show name. This type of data not only allows for better search results, but it allows you to browse content without having to do text-based searches, which you probably won’t be doing when television and future web-enabled tablets start to serve up this content. Clicker already has a deal with Boxee.

The goal is really to be the best search engine for video content. Clicker will point you in the direction of whatever you are looking for (and will do embeds if they’re available), but won’t serve up the videos themselves. They will also delve into surfacing content not explicitly produced for television, but is still high quality web video content. But they don’t want to be YouTube, which is cluttered with user-generated content. Clicker is going for a different market.

Clicker will also allow users to edit and submit information about shows wiki-style.

As a search engine, the business model will obviously be search and display advertising. But eventually, there is a plan for Clicker Pro premium accounts, which the company envisions might be used for storing you favorite videos online, kind of like a DVR of sorts.

CEO Jim Lanzone (former CEO of Ask.com) and COO Paul Wehrley presented Clicker today on stage at TechCrunch50.

Expert Panel Q&A (paraphrased)

The experts: Don Dodge, Yossi Vardi, Ron Conway, George Zachary, and Jason Hirschhorn.

Q: Is this automated?

JL: Where content resides is always changing, a lot of it is automated, but we have to find stuff too.

Q: How do you monetize.

JL: We’re looking at the IMDb model. And eventually we’ll have a Pro version. And there’s a downstream model since we’ll be sending a lot of traffic.

Q: What do you think about Bing?

JL: That’s not fair. I think it’s fantastic for pushing beyond 10 blue links. A lot of it looks familiar though.

Q: How do you get the market penetration?

JL: Part of it is branding, some of it is distribution deals. We’ll also be very heavily SEO’d.

Q: What’s the business model?

JL: It’s mostly advertising, and we’ll get into Pro later, again. But IMDb makes $75 to $100 million in just what they do.

Q: Is this funded?

JL: Yes, earlier this year Benchmark and Redpoint – $8 million.

Q: Would you invest?

JH: This is a big problem for web video.
RC: Great product.
YV: I can never predict if products will succeed so I bet on people. Jim is a good one to bet on.

Video:

Other Coverage:
TC50: Clicker is a TV guide for the Internet age VentureBeat.
Clicker Guides You To Internet TV #TC50 Techgeist.
Clicker’s Guide to Online Video Technologizer.
Stealth Report: TV / Video search engine Clicker AltSearchEngines.
Former Ask.com CEO Lanzone Launches Video Search Engine paidContent.

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The cause, of course, is the Michael Jackson effect — media organizations around the world dedicated huge amounts of coverage to the pop star’s tragic death on June 25, and many people turned to the web to learn more. Other breaking news that month, including the Iranian election controversy, also likely contributed to the growth seen by news properties.

Hulu, which has ranked as the third most popular video site in the United States for the past few months, has dropped down to seventh. Likewise, Fox Interactive Media, which includes MySpace, has dropped from second to fifth.

So who took their place? Video search engine Blinkx jumped from sixth place in May with 300,641 views to fourth overall with over 623,000 (Note:all figures in 000’s). Microsoft also saw a big jump, rising from fifth place in May with 310,560 overall streams, to third place in June, with 695,661 streams (much of this gain was likely due to increased traffic to MSN and MSNBC). Turner, the parent company of CNN, also saw its video views nearly double.

Finally there’s Viacom, the media conglomerate that includes Nickelodeon, MTV, Comedy Central, and BET. Viacom vaulted from seventh place in May with 281,368 views to second place in June, with a whopping 773,554. Again, much of this can likely be attributed to the Michael Jackson news that was featured prominently on MTV, but Nickelodeon also saw strong traffic, which may be related to the summer season when kids generally watch more TV.

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Earlier this week I had something of an epiphany. Hulu, with its mountains of movies and prime-time TV shows, is the perfect answer to the summer doldrums. I’m finally free to catch up on those shows that my friends have been talking about for years, or at least watch the first few episodes of a show to see if it’s worth buying on iTunes or DVD. Eureka!

Unfortunately, when I went to catch up on a few shows the other night, I fell prey to a problem that’s nagged the site since it launched: content owners frequently impose bizarre restrictions on which content you’re allowed to watch on Hulu. The number of episodes available for each show vary wildly, and serial dramas will sometimes only offer a smattering of episodes scattered across a season, which makes it impossible to follow the story line. Hulu does its best to explain the situation to users with messages like “We are able to run five trailing episodes of this series”, but these bulletins don’t do much to ameliorate the frustration and apparent lack of logic. In short, it leads to a bad user experience on an otherwise highly-polished site.

A quick spin through the site reveals how bad the problem is. Rescue Me, which I’d heard was quite good, has a measly three episodes available, all taken from the end of the fifth season. Given that I know absolutely nothing about the show other than that Dennis Leary plays a firefighter, I figured this probably wasn’t the best way to get hooked. Fox’s popular serial drama 24 is currently offering a whopping five episodes, but these are taken from the middle of the first season (for those that haven’t seen 24, trying to pick up the story mid-season is an exercise in frustration). Battlestar Galactica is similarly limited. The list goes on.

In case it wasn’t obvious, Hulu has very little control over what it’s allowed to show users — it’s forced to bow to the whims of its content partners. And while it’s easy to point the finger at the studios and accuse them of simply being withholding, the reality is likely a bit more complicated. Distribution of this content is impacted by ‘windowing’ — the time periods when the rights to a show or movie belong to different mediums like Cable, syndication, or DVDs. So in some cases, studios really may have their hands tied.

That said, it’s hard to imagine that some of these media companies couldn’t do a better job with their licensing deals, and I suspect some of them really are withholding content because they’re afraid of undercutting their DVD and iTunes sales. In those cases, they’re shooting themselves in the foot.

If I can’t begin watching a show from the start, the odds of me watching it at all plummet. Sure, I could probably buy the first season on iTunes, but I’m not likely to pay for TV unless I’m quite certain I’m going to like it. Studios should be doing everything they can to introduce Hulu users to new shows during these summer months, perhaps going as far as enabling access to a show’s entire first season. Yes, I might wind up skipping buying the first season on DVD, but I’m also far more likely to go out and buy seasons 2-3 so I can continue watching from the comfort of my couch.

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Apparently the general public wasn’t alone in liking the ad. Hulu has just been nominated for an Emmy Award in the category “Outstanding Commercial” — a feat that few other consumer websites have ever accomplished (I believe the only other startup to get a nod was Snap.com in 1999, when that site was home to a search engine).