No industry is changing more quickly than digital video—the world of streaming content has touched every other aspect of entertainment media, whether it's by distributing it more conveniently, adding ads to it, or just enabling the savvy and unscrupulous to steal it more easily. We picked five moments that stood out in the annals of digital video this year—we think you'll agree they were all pretty impressive.
Jeff Bewkes Loves Piracy
Time Warner chief Jeff Bewkes is an executive with a personal vendetta against boring quotes, so it makes sense that he'd get interesting questions in an earnings call. What's a little less expected is that when Bewkes was asked what he thought of the piracy bonanza plaguing HBO's Game of Thrones, he'd be not just laid-back, but positively sanguine about it.
"We've been dealing with this for 20, 30 years—people sharing subs, running wires down the backs of apartment buildings," he said to a reporter who asked him what he thought about GoT breaking piracy records. "Our experience is that it leads to more paying subs. I think you're right that Game of Thrones is the most pirated show in the world. That's better than an Emmy."
Netflix has been on a hot streak as far as stock price goes for months now, but the biggest news came in the company's Q1 earnings report, when it finally let slip some solid numbers: the company had passed HBO in subscribers. By year-end, the company had a full 40 million subs, as well as 14 Emmy nominations and one win for best director over Boardwalk Empire, Breaking Bad, Homeland and Downton Abbey. And then Marvel announced that its next TV deal would be for four new series distributed exclusively through the digital service.
Add to that new shows including the much-acclaimed Orange Is the New Black and the much-argued-about fourth season of Arrested Development, and you've got a company that has become the standard for nontraditional distribution and Web video.
Hulu Makes a Billion Dollars
There's been plenty of scuttlebutt about whether 21st Century Fox and Disney will eventually decide to cut their baby in half, but for now, Hulu is staying where it is. Why? Because it makes quite a bit of money. Netflix will almost undoubtedly top $4 billion this year, but here's the thing: much of Hulu's content is provided by its owners and all of it is sponsored, so its $1 billion is a number with a much smaller astersik next to it.
Netflix's relationship with its content providers remains tense at best, as networks try to figure out the right balance that won't cannibalize live viewership. The upshot is that its content is incredibly expensive—as in, so expensive that the company only makes money on paper. Hulu sells ads, it owns many of its shows, and it spends far less on licenses than its competitor.
Amazon Crowdsources Its Scripted Pilots
Amazon wants in on the digital video game that has proved so lucrative for Netflix and Hulu, but it chose a totally different tack when it came to programming. Where Netflix throws money at prestigious filmmakers and hopes for the best and Hulu mimics the development process at traditional networks, Amazon tried something unorthodox: it took a vote. The company piloted series including a show based on tongue-in-cheek horror flick Zombieland, a musical comedy called Browsers, and a show about embattled Republicans by Garry Trudeau called Alphas.
Alphas went to series (as, weirdly, did Betas, a less illustrious show about dudebros hangin' in Silicon Valley), and Amazon is continuing the experiment. As with most of its competitors, there aren't any viewership statistics, but we'll see come the new year whether giving the people what they want was worth it.
TV Pilots End Up on Digital, and Digital Shows End Up on TV
Television content migrated to the Web this year—we've never seen so many failed cable pilots as we did at the Digital Content NewFronts—but the reverse was also true, and some found success in both places.
Syfy passed on a silly pilot called Ghost Ghirls for a 30-minute comedy; producer Jeremy Konner and his crew cut it down to a series of sketchy shorts for Yahoo and came up with something genuinely funny.
Coincidentally, it wasn't the only thing Konner managed to sell: his Web series Drunk History made the leap from YouTube to Comedy Central within a few months of that deal.