September 25, 2023

Hulu Says Number of Paid Subscribers Has Doubled

Hulu, the online video Web site that has both free and paid services, said Tuesday that it had doubled its number of paying subscribers in the last year, to four million.

The announcement comes at an uncertain time for Hulu, as two of its owners, the Walt Disney Company and News Corporation, weigh whether to sell the company. Last month, the founding chief executive of Hulu, Jason Kilar, stepped down; one of his top lieutenants, Andy Forssell, is now the acting chief executive.

Hulu was not expected to say anything new about its ownership structure at a Tuesday morning event for advertisers in New York. The event, part of the Digital Content NewFronts this week, was set up to promote several original series that will premiere on Hulu this year.

Among the shows that will be distributed exclusively by Hulu are “Quick Draw,’’ a comedic Western set in 1870s Kansas, and “The Awesomes,” an animated series about superheroes from the minds of the “Saturday Night Live” star Seth Meyers and the “Late Night With Jimmy Fallon” producer Michael Shoemaker. They are the third wave of original shows for the service, and the most ambitious to date. The first wave, in 2011, was led by the Morgan Spurlock documentary series “A Day In The Life;” the second, in 2012, included a political sitcom called “Battleground” and a travelogue by Richard Linklater called “Up to Speed.”

That said, Hulu’s most popular shows remain those that it licenses from their owners and from other media companies. Hulu says it has more than 470 such partners and more than 70,000 full television episodes on its free and paid services combined.

Content costs are rising as the online television marketplace becomes more competitive; last week, Yahoo snapped up the exclusive rights to old clips from “Saturday Night Live,” something that Hulu used to feature on its own site.

In this crowded environment, commissioning shows is one way to stand out. Hulu has been in the news this week because it is one of only two places to watch “All My Children” and “One Life to Live,” the canceled ABC soap operas that were resurrected online by a production company, Prospect Park. The other outlet for the shows is Apple’s iTunes store.

Along with “The Awesomes” and “Quick Draw,” Hulu’s other two original series this year are “Behind the Mask,” a documentary series about sports mascots, and “The Wrong Mans,” a drama about two innocent men tied up in a criminal conspiracy. “The Wrong Mans” is a coproduction of the BBC and Hulu.

At the advertiser event on Tuesday, Hulu will also promote a number of shows that have been televised in other countries, but are exclusive to Hulu in the United States. They include an animated series from Canada called “Mother Up!” as well as “Prisoners of War,” an Israeli drama that inspired Showtime’s “Homeland.”

The company will also describe several ideas for original shows that are “brand contingent,” meaning they will be made only if advertisers sign up to support them. One of these ideas involves the chef Mario Batali in conversation with celebrities; another is a performance series to be hosted by Carson Daly.

In addition to announcing that its paid service, Hulu Plus, had topped four million subscribers for the first time, up from two million in the previous year, Hulu said it had reached a new revenue record in the first quarter, but did not specify what that record was. In 2012, according to the company, it earned $695 million in revenue, up from approximately $420 million in 2011.

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Discovery Expands Its Reach Overseas to Ensure Growth

“Here Comes Honey Boo Boo,” the reality show on TLC in the United States, has become an unlikely hit in Brazil and dozens of other countries where it is broadcast on some of TLC’s 150 international channels. To help explain its particularly American milieu and language, the episodes come with a glossary of common terms: “concurso de brillo” in Spanish for “glitz pageants”; “gorduchéte” in Portuguese for “chubette.”

The series and its popularity overseas are just one aspect of Discovery’s growing international business. The company, based in Silver Spring, Md., owns 14 domestic cable channels including Discovery, OWN: The Oprah Winfrey Network and Animal Planet, but its executives see growth coming from places like Brazil, Mexico and Russia.

“We don’t see ourselves as a domestic media company,” said David M. Zaslav, Discovery Communications’ president and chief executive, in a phone interview from Moscow, where he was visiting with the company’s 32 local employees. (The week before, he had business meetings in Paris, Switzerland and Belgium.)

Discovery’s strategy signals how the cable television business in the United States is maturing. With a proliferation of channels competing for a diminished number of total viewers, media companies have looked elsewhere for growth.

Last year, News Corporation paid $335 million to complete its acquisition of the Singapore-based ESPN Star Sports, previously a joint venture with the Walt Disney Company. Viacom has in recent years expanded its footprint in Russia, Eastern Europe and Latin America. In India, the company owns Colors, a Hindi-language general entertainment pay TV channel.

“You have many markets with substantial G.D.P. growth ahead of them and multichannel infrastructure growth,” Robert M. Bakish, president and chief executive of Viacom International Media Networks, said in an interview last year. “TV in the U.S. is pretty well saturated.”

Discovery has channels in 217 countries and territories in 45 languages as well as 1.3 billion subscribers outside the United States. In the six years since Mr. Zaslav took over as chief executive in 2007, the company has grown from making around $720 million in total profits, with roughly $120 million coming from overseas, to making $721 million just from its international business, or 34 percent of its total profit of $2.1 billion, in the fiscal year that ended Dec. 31.

In the coming weeks, Discovery is expected to close its biggest deal yet: a $1.7 billion acquisition of SBS Nordic, a Scandinavian programmer that includes 12 television networks, radio stations and digital assets in Denmark, Finland, Norway and Sweden.

The SBS deal came around the time Discovery agreed to pay about $240 million for a 20 percent stake in Eurosport, a Pan-European cable sports channel that broadcasts tennis, cycling and cross-country skiing and other sports in 59 countries, and other pay television assets owned by the French media company TF1 Group. The transaction gives Discovery the chance to take majority ownership of Eurosport in two years.

After the SBS acquisition closes, more than 40 percent of Discovery’s business will come from abroad, making the company the biggest among its competitors in the international cable television business. On Thursday, Discovery will hold its annual upfront presentation to unveil its business and programming plans to advertisers and reporters.

Thirty-eight percent of Discovery’s revenue last year came from its international business, compared with 44 percent for News Corporation, 29 percent for Viacom and 28 percent for Time Warner, according to Wall Street estimates in Discovery’s latest investor presentation.

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Disney Junior Challenges Nick Jr. in Preschool TV

Nick Jr. has long been cable television’s No. 1 channel dedicated solely to preschool children. The service, owned by Viacom, had a smash hit in “Dora the Explorer,” which made its debut in 2000. Competition was also light: the Walt Disney Company, preoccupied with hunting for preteenagers, operated no 24-hour preschool channel.

But in the year since Disney introduced Disney Junior, a channel aimed at the tiniest of viewers, Nick Jr. ratings have plummeted more than 50 percent, according to Nielsen. On Tuesday Nielsen data for Disney Junior will be revealed for the first time; the new channel is expected to beat its rival, even though Nick Jr. is available in 75 million homes, 25 percent more than Disney Junior.

Disney now has the top three preschool cable programs, led by what appears to be a monster-size new hit, “Sofia the First,” a cartoon that stars a pint-size princess and her zany animal friends.

Although ad revenue is small — Disney Junior accepts limited sponsorships; Nick Jr. allows advertising aimed at mothers, but only a bit — the potential payoff in the toy aisle is huge. Even at 13, “Dora the Explorer” generates about $1 billion annually in global retail sales. “People have been saying ‘Dora is dead’ for years, but the old girl still has a strong following,” said Chris Byrne, a toy analyst.

Merchandise related to Disney Junior shows is already catching fire among retailers. Disney said it expected sales to surpass $1.5 billion in its current fiscal year, a 50 percent increase from last year.

“A massive, massive success” is how Richard Barry, chief merchandising officer for Toys “R” Us, described products related to “Doc McStuffins,” a new Disney Junior hit about a girl who runs a clinic for her toys. One doll sold out so fast it soon traded on eBay for $300.

Animated preschool shows also draw strong audiences in reruns, and some easy dubbing makes them a valuable overseas export. Beyond all of this, the value of future brand loyalty is incalculable. Anne M. Sweeney, president of the Disney-ABC Television Group, has devised her fast-growing TV portfolio to retain children as they grow, just as Viacom tries to hook toddlers into the Nickelodeon family.

Disney’s hope is that they will start with Disney Junior; migrate to the Disney Channel, aimed at ages 6 to 14; and then move on to boy-centric Disney XD or ABC Family, which is on a hot streak of its own. “These children are the Walt Disney Company’s most important audience,” Ms. Sweeney said. “They’re the future, and this is their first introduction to our brand.”

Preschool television has long been a rough and tumble playground, with broadcasters competing against upstart cable channels. Children ages 2 to 5 spend an average of 32 hours in front of a TV each week, according to Nielsen. But competition is increasing. For media companies, this represents an area of growth and, as more children move to mobile devices, there is more pressure to keep their attention.

The battle has moved to apps, with Nickelodeon, Disney and Sesame Workshop, producer of PBS’s “Sesame Street,” competing to funnel preschool shows to iPads — by some measures the new electronic baby sitters.

Nickelodeon in particular is fighting back at Disney Junior. Last month, it unveiled four new preschool programs, including a spinoff of “Dora the Explorer.” Another new series called “Wallykazam!” tries to teach literacy, embedding a reading curriculum in a plot that involves a boy and his pet dragon, Norville.

Not to be counted out is Sprout, a channel largely stocked with PBS shows like “Thomas Friends” that has grown steadily since becoming part of NBCUniversal in 2011. Sprout is pushing new merchandise of its own and has increased marketing efforts, entering a float, for instance, in last year’s Macy’s Thanksgiving Day Parade.

Preschool entertainment is a politically delicate area filled with advocates who recoil at TV aimed at children as young as 2. “There continues to be a lot of anxiety from parents over how much TV is too much,” said Dade Hayes, author of “Anytime Playdate: Inside the Preschool Entertainment Boom, or How Television Became My Baby’s Best Friend.”

Even so, Mr. Hayes, who is also executive editor at the trade publication Broadcasting Cable, noted that there had been surprisingly little commotion over “Sofia the First.” That show was considered risky because — while rooted in teaching social skills — it is more driven by entertainment than overt education. Princess Sofia, wearing a purple gown and tiara, attends a prep school run by the three fairies from “Sleeping Beauty.”

Nickelodeon’s preschool offerings are known for engaging characters mixed with eat-your-broccoli educational messages; one hit, “Ni Hao, Kai-Lan,” aims to teach children some Chinese. “We were in the trenches talking to kindergarten teachers and brain experts,” Teri Weiss, executive vice president for production and development at Nickelodeon Preschool, said of the development of “Wallykazam!”

She added: “There are competitors that dabble in education.”

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Media Decoder Blog: ABC Networks Will Offer Guarantees to Advertisers Across Platforms

The Walt Disney Company will take a significant step toward equalizing the business of advertising on television and online this spring when three of the networks owned by the company, ABC, ABC Family and ESPN, offer advertisers guarantees for video programming distributed both on television and online.

The ABC networks will announce Tuesday that they have adopted the Nielsen Online Campaign Ratings system to measure viewing across both television and online sites, and will base all sales on estimates of what total viewing will be on all those platforms.

Traditionally, television networks guarantee advertisers that they will deliver a certain numbers of viewers in specific demographic groups. When viewing falls short of those numbers, the networks provide free commercial time to make up the difference.

But online viewing has lacked a service that could provide similar information for video streamed online. ABC has been aggressively seeking a way to combine guarantees both on television and online. Adam Gerber, vice president of sales development and marketing for ABC, said the company gave combined viewing guarantees to some advertisers in last year’s upfront – the sales period in spring when networks made deals with advertisers for future programming — but expected “a much more robust demand for those kinds of deals” this year.

“We are seeing a rapidly growing demand for cross-platform deals,” Mr. Gerber said.

The Nielsen service will provide detailed information on online viewing in two ways, said Steve Hasker, the president of Global Products for Nielsen. One is information that will go to the advertisers about the reach of specific ad campaigns. “If an auto maker places ads on all different platforms, on television and online, we’ll be able to measure all the people that see that particular campaign,” Mr. Hasker said.

That will be possible because the commercials will carry a specific tag to identify them, he said.

But for a network to be able to offer a ratings guarantee, it needs a way to get an accurate measure of total viewing of each program, which may take place on numerous different online sites. Mr. Hasker said the Nielsen system would be able to keep track of how many times people watched the show on any online sight as long as the program contained a tag provided by the network.

Mr. Gerber noted that the problem in the past with online viewing was that a headcount was possible, but not the information on the makeup of the audience that advertisers require. Nielsen is solving that by using data provided by Facebook to identify the characteristics of the online viewers.

In some respects, online advertising enjoys advantages over television advertising because in most cases online commercials cannot be skipped by viewers, and they can be easily swapped: a commercial for a movie opening on Friday that might get out of date if watched on a delayed basis on television can be replaced online with a more up-to-date commercial.

At the moment, advertisers pay only for the commercials watched in a television program within three days of its air date. But Nielsen issues reports on viewing that accumulates over a full week. Mr. Hasker said the combined television and online audience of video would be reported on the basis of a week’s worth of viewing — even though online episodes of shows stay active on sites for a month or more.

He credited ABC with being “especially innovative” in its approach to offering guarantees for online advertising as well for television viewing, but he said that Nielsen was in active conversations with numerous other big television companies about adopting the combined ratings service.

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Disney Gambles on Box-Office Wizardry of ‘Oz’

On Friday, when this wizard and his hot air balloon land in theaters, the Walt Disney Company hopes ticket buyers won’t think the same thing.

No movie studio would have the nerve to remake “The Wizard of Oz,” the beloved 1939 musical ranked by the Library of Congress as the most-watched film in history. But “Oz the Great and Powerful,” a Disney-produced prequel, is nearly as intrepid. The company is betting that a new twist on a story moviegoers already love will result in a hit on par with “Alice in Wonderland,” which took in more than $1 billion in 2010.

It’s a breathtaking gamble. “Oz,” at turns goofy and dark (and not a musical), cost about $325 million to make and market, according to people who worked on the movie who spoke on the condition of anonymity to avoid conflict with Disney. Mr. Franco has never anchored a mainstream movie before. Because of copyright constraints Disney was not able to reproduce certain iconic imagery from the “The Wizard of Oz,” which is owned by Warner Brothers.

And audiences have already rallied around a “Wizard of Oz” prequel: “Wicked” has been a Broadway hit for nearly 10 years.

Disney’s marketers have not been cowed by the huge shadow cast by the original “Oz” — indeed, their ads for the new film invite comparisons to the classic. But the popularity of the original may ultimately represent the studio’s biggest challenge. Is there room for a new cinematic vision of Oz, as Disney believes? Or will movie audiences (and critics) be reluctant to embrace an Oz that does not look a certain way, have a certain tone and feature a certain set of slippers?

Hollywood is confronting issues like these with greater regularity. Studios, ever-desperate for source material that is both familiar and comfortable to consumers, have leaned more heavily toward sequels and prequels.

But nostalgic properties are tricky. There are liberties you can take and ones you cannot, producers say, and the lines are blurry.

Sean Bailey, Disney’s president of movie production, said in an interview that he was “cautiously optimistic” about the box-office prospects for “Oz the Great and Powerful,” which was loosely based on the novels of L. Frank Baum.

“Going in, we certainly talked a lot about these iconic books, the iconic movie and the iconic musical,” Mr. Bailey said. “We felt there was room for a new story. We felt this great land was worthy of exploration and that it could be creatively exciting.”

Mr. Bailey and Alan F. Horn, Disney’s new studio chairman, are under pressure to deliver a hit. “John Carter,” which opened a year ago, forced the company to take a $200 million write-down, one of the largest in movie history. Since “John Carter,” releases on the Disney label have included “The Odd Life of Timothy Green,” which took in a ho-hum $51.9 million, and “Frankenweenie,” a critical success but a box office failure, which sold just $35.3 million in tickets in North America.

Disney is betting that going big is the key to a turnaround — hiring marquee directors and stars with serious acting credentials for pictures with giant budgets. After “Oz” comes “The Lone Ranger,” a comedic Western starring Johnny Depp as Tonto. In July 2014 Disney plans to release “Maleficent,” starring Angelina Jolie as the evil sorceress from “Sleeping Beauty.”

Tackling such well-known material risks stepping on memories, however. Oz itself has proved difficult in that regard over the years. Audiences recoiled from “The Wiz,” a 1978 adaptation of the stage musical. The response to “Return to Oz,” a 1985 Disney effort that found Dorothy in an asylum, was equally dismal.

For “Oz the Great and Powerful,” directed by Sam Raimi, Batman offers one positive point of comparison; that character, which coincidentally first appeared in a 1939 comic book, has been successfully reincarnated at the multiplex for several generations, noted Bob Gazzale, president of the American Film Institute.

The 2005 remake “Charlie and the Chocolate Factory” is a more cautionary example. What seemed like a good idea on paper — Johnny Depp as Willy Wonka, with lots of digital imagery — was ultimately a disappointment, with a fey Mr. Depp and his computer-generated Oompa Loompas striking moviegoers as a tad creepy.

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Media Decoder Blog: Infinity, a New Video Game, Combines the Worlds of Disney

LOS ANGELES — Imagine monster truck tires on Cinderella’s carriage. Or Capt. Jack Sparrow being smacked around by Sulley from “Monsters Inc.” Maybe Mr. Incredible, armed with a toilet-paper-roll launcher, riding in Peter Pan’s flying pirate ship.

It’s all possible, and it’s all sanctioned by the Walt Disney Company — a company known, at least until now, for maintaining rigid walls between its character and movie franchises.

On Tuesday, Disney Interactive Studios unveiled Infinity, an ambitious video game and action figure initiative. Infinity, three years in the making under the code name Toy Box, will allow players to mix and match characters and props from Disney and Pixar movies, including the “Pirates of the Caribbean” series and “The Incredibles.” Never before has Disney allowed this type of mash-up.

“If you want Mr. Incredible riding in Cinderella’s coach, go for it,” said John Blackburn, general manager of Avalanche, a game development studio owned by Disney that made Infinity, at a demonstration this month.

Infinity is similar to Skylanders, a popular toy and video game franchise from Activision Blizzard. Skylanders has generated more than $500 million in sales since its arrival in 2011; about 30 million related toys have been sold under the brand. Skylanders players collect action figures, then transfer them into the game’s action by plugging them into a sensor base.

That kind of digital hit is urgently needed at Disney Interactive, which has lost money for the last 16 quarters — more than $1 billion.

Lately, though, it has been introducing new products, including a revamped, in an effort to turn a profit by the end of the year.

Infinity is scheduled to arrive in stores in June, pegged to the release in theaters of Pixar’s “Monsters University.” It will be available on gaming consoles (Xbox 360, PlayStation 3, Wii) and on the Internet. A full mobile version is scheduled to arrive shortly after.

To play Infinity, users will buy a $75 game. It will come with a base where figurines of various Disney and Pixar characters can be plugged in.

Three figures come with the starter kit: Sulley, Jack Sparrow and Mr. Incredible. Other figures and add-ons will be sold separately, priced at $5 to $35. Disney’s goal is to create a collecting frenzy — certain figures will be intentionally hard to find — while rolling out new characters from its archives. Expect “Star Wars” and Marvel figures down the road, for instance.

“We want to focus on products that are superhigh-quality and that can be sustained and built on over time,” said John Pleasants, co-president of Disney Interactive. “I really want this to move the bar for the Walt Disney Company.”

Disney declined to comment on Infinity’s development costs, but analysts estimate that Activision spent at least $100 million to introduce Skylanders.

For all its promise, Infinity comes with major challenges. It will immediately be compared to Skylanders, for starters. Also, Disney has struggled in the video game business in part because its main characters are more popular with girls than with boys (who make up the bigger gaming audience). And parents may balk at adding yet another collectible toy line to their carts. Infinity is also a complex game, posing a challenge for Disney marketers.

To understand what a major departure it is for Disney to allow characters to be combined in one world — even a virtual one — consider what happened at the entertainment giant a decade ago when its consumer products division wanted to repackage Cinderella, Sleeping Beauty and Snow White as Disney Princesses. Traditionalists revolted, including Roy E. Disney, the nephew of the company’s founder and then a board member.

Allowing Pixar and Disney characters to exist and interact in a single video game world was not quite as controversial, but there was still significant resistance, according to Mr. Blackburn of Avalanche. He described the reaction by some senior Disney executives to Infinity not with words but by making a gruesome facial expression. (Picture someone taking a strong whiff of sour milk.)

But John Lasseter, Pixar’s chief creative officer, became an early supporter and threw the animation studio’s full weight behind the game. He had a trusting relationship with Mr. Blackburn’s studio, which made Toy Story 3: The Video Game, a product that allows users to edit the playing world as they see fit. Ultimately, Disney’s reluctant “brand stewards” were asked to take an early version of Infinity home and watch how their children played with it.

The realization began to sink in: if Disney wanted to do something big in the game arena, it would need to let people play in a less restrictive way. Mr. Blackburn said the thinking in the corporate ranks became, “O.K., maybe we are holding too close to some of these characters.”

One of the resulting Infinity marketing slogans reads: “Their worlds. Your imagination. No rules.”

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Media Decoder Blog: Hulu’s Chief Is Leaving, Raising Questions About Its Future

8:39 p.m. | Updated
Jason Kilar, the Web wizard who turned Hulu from a punch line into a popular source of online video, said on Friday that he would step down as the site’s founding chief executive in the next three months.

The announcement is certain to turn up the volume on something that’s a constant hum in the media industry: speculation about the future of Hulu — and if it has one at all. Its owners, the Walt Disney Company, Comcast and the News Corporation, also run the ABC, Fox and NBC networks, and they do not agree about what to do with the Web site. Perversely, the more popular Hulu becomes, the more of a problem it is for the owners, since it may be taking viewers and advertising dollars away from their core television businesses.

Mr. Kilar never saw it that way, however. He was Hulu’s best advocate, sometimes clashing with the network executives on Hulu’s board and arguing that they had to keep investing in the site, since television’s future will surely involve Internet distribution.

For many Americans, that future is already here: Hulu’s streams of TV shows attract 30 million unique visitors a month via computers and untold millions more via tablets and Internet-connected television sets. Three million pay for Hulu Plus, its subscription arm — not bad for a start-up once ridiculed as “ClownCo.”

Mr. Kilar declined an interview request on Friday. In an e-mail message to employees, he gave no indication why he was moving on or what he might do next. “My decision to depart has been one of the toughest I’ve ever made,” he said.

He said his departure would take effect within the first quarter of the year. No successor was named.

Mr. Kilar, a former executive at Amazon, has in the past been mentioned for a number of prominent jobs in Silicon Valley. He was a top candidate last year for the chief executive position at Yahoo, but Hulu said he declined to be considered. The job later went to Marissa Mayer, a longtime Google employee.

His departure comes just several months after the only independent owner of Hulu, Providence Equity Partners, sold its 10 percent stake, originally bought for $100 million, for $200 million. Mr. Kilar and other employees also sold their stakes in the company at that time, netting Mr. Kilar about $40 million, according to an executive with knowledge of the transaction.

On Friday, there was widespread praise for Mr. Kilar for steering Hulu through sometimes turbulent seas. “He defied enormous odds, built from scratch one of the top five digital video brands, created two viable and growing businesses (free and pay) and got his well-deserved payday — not bad for five years’ work,” J. B. Perrette, who used to help oversee NBC’s investment in Hulu and now runs Discovery Communication’s digital operations, said in an e-mail.

That said, Mr. Kilar’s announcement did not entirely surprise many in the industry. During his tenure, he sometimes clashed with the owners on Hulu, exemplifying the divide between new, disruptive modes of distribution like the Internet and the more traditional operations at major media companies. As the parent companies pulled back on the amount of ABC, Fox and NBC programming provided to Hulu, the Web site invested in original content to fill the gaps and attract attention. That investment effort continues, led by one of Mr. Kilar’s deputies, Andy Forssell, but many in the industry say they believe that Hulu’s future remains fuzzy.

An internal memo obtained by Variety in August showed that the owners may want to change their agreements with Hulu so that it is no longer the exclusive distributor of repeats of television shows like “The Office” and “Family Guy.” That way, the owners could also sell repeat rights to online video services like YouTube, Netflix or Amazon.

Some of the owners also wanted more advertisements on the site, which had revenue of about $700 million last year but is not yet believed to be profitable. Much of the revenue came from Hulu Plus, and therein lies another fault line: the owners may concentrate on the paid part to the detriment of the free streaming part.

The owners had no comment about any of that on Friday, though. Robert Iger, Disney’s chief executive, called Mr. Kilar an integral part of the Hulu story and said in a statement, “We are proud of his achievements, we appreciate what he’s built, and we share his confidence in his team’s ability to drive Hulu forward from here.”

Rich Tom, the site’s chief technology officer, will also depart in the first quarter.

This month, Richard Greenfield, an analyst at BTIG Research, predicted that News Corporation would seek to acquire its competitors’ stakes in Hulu in 2013. Comcast, he said, has no managerial control of Hulu and Disney “appears increasingly less interested” in the site.

In August, News Corporation said that Jonathan Miller, the company’s chief digital officer since 2009 and a vocal champion of Hulu, would leave the company. Mr. Miller represented News Corporation on the Hulu board and had helped the media company broker a stake in Roku. News Corporation has had some high-stakes stumbles in technology with both Myspace and its tablet-only publication, The Daily, which has led some analysts to expect the company to tread cautiously with future digital investments like Hulu. And Chase Carey, the No. 2 to the chief executive of News Corporation, Rupert Murdoch, is said to be less enamored with the service.

Mr. Murdoch, however, praised Mr. Kilar for “building Hulu into one of the leading online video services available today.” He added, “It’s incredibly well positioned for the road ahead.”

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Media Decoder Blog: Buoyed by ‘Avengers,’ Disney Profit Surges 24 Percent

LOS ANGELES — The success of the film “Marvel’s The Avengers” and the “Cars”-related expansion of a theme park powered the Walt Disney Company to a 24 percent increase in quarterly profit, well ahead of expectations, the company reported Tuesday.

Disney, with operations ranging from movies to hotels to baby clothes, is closely watched as a barometer of consumer confidence. Lately, however, that correlation has seemed out of alignment. Why is Disney surging when the frail economy has people keeping a lid on discretionary spending?

The answer may be that consumers simply see Disney’s recent offerings (with a few notable exceptions) as attractive ways to spend their money.

Many people grumble that Disney’s parks are expensive, but they also seem to see the value. Attendance was strong in the quarter at both Walt Disney World in Orlando, Fla., and at Disney’s California Adventure park in Anaheim, Calif., where a lavish “Cars”-themed parcel recently opened as part of a $1.1 billion overhaul. Disney said per capita guest spending at its domestic resorts increased 8 percent. Add in strong bookings for a new cruise ship and a return to normal at Tokyo Disney Resort after last year’s earthquake, and operating income at Disney’s parks unit rose 21 percent, to $630 million.

Similarly, “The Avengers” has taken in over $1.5 billion at the global box office, in part because that superhero film prompted consumers to pay more — $3 to $5 more per ticket — to see it in 3-D. For the quarter ended June 30, Walt Disney Studios reported operating income of $313 million, an increase from $49 million a year earlier. Disney announced on Tuesday that Joss Whedon, who directed “The Avengers,” would return for a sequel and help develop a Marvel-related property for the company’s ABC broadcast network.

Fans were also shopping briskly during the quarter at Disney’s mall-based retail stores, where “Avengers”-themed merchandise and new locations helped the company’s consumer products division report a 35 percent increase in operating income, to $209 million.

Disney’s long-suffering Internet division even looked healthier, improving to a loss of $42 million, compared with a loss of $86 million in the same period a year ago, mainly because of increased traction in social games. (Disney told analysts that the coming quarter might be more difficult, however, because of the release of fewer console games.)

Robert A. Iger, Disney’s chief executive, called the results “phenomenal” in a statement, adding that the totals were “the largest quarterly earnings in the history of our company.” Disney had net income of $1.83 billion, or $1.01 a share, compared with $1.48 billion, or 77 cents a share, in the year-ago quarter. Analysts had been expecting income of 93 cents a share.

Revenue for the quarter, the third in the company’s fiscal year, climbed 4 percent, to $11.09 billion, held down because of a timing shift in the recognition of ESPN-related affiliate fees. At Media Networks, the Disney unit that includes ESPN, ABC and cable channels like ABC Family, operating income climbed 2 percent, to $2.13 billion. ESPN did suffer higher production costs tied to a shift in timing for National Basketball Association games and higher rates for N.B.A. and Major League Baseball programming.

In recent years, some analysts have questioned Disney’s high level of capital and acquisition spending, citing global economic weakness. But the most recent quarter offered a strong endorsement of the investment strategy set by Mr. Iger.

“The Avengers” was made by Marvel Entertainment, which Disney acquired in 2009 for $4 billion. Cars Land cost about $450 million, but it seems to have turned around California Adventure, a park that languished for a decade because of underinvestment by Mr. Iger’s predecessor.

Brooks Barnes writes about Hollywood with an emphasis on Disney. Follow @brooksbarnesnyt on Twitter.

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DealBook: News Corp. Shares Leap on Potential Split

Shares in News Corporation rose more than 6 percent in morning trading on Tuesday, on reports of a potential plan to split the media empire in two.

Under the terms of the proposed split, the company would spin off its publishing business from its much larger entertainment unit, according to a person briefed on the matter. That would create two corporate entities: an entertainment giant, driven by a movie studio and powerful television networks, and a much smaller publishing unit containing Dow Jones and HarperCollins.

The move would be intended to appease shareholders unhappy with the general tepidness of News Corporation’s stock performance, which has not kept pace with the likes of the Walt Disney Company. While the company’s shares have risen more than 17 percent this year, that increase has been supported in part by an extensive and expensive stock buyback initiative. On Tuesday, News Corporation’s stock hit $21.50 shortly after the opening bell, its highest level since late 2007.

The potential split comes even as a phone-hacking investigation continues to cloud News Corporation’s newspaper business in Britain.

The plan has the support of several News Corporation executives, notably the chief operating officer, Chase Carey, this person said. Mr. Carey said earlier this year that management had considered a split, though at the time he added that nothing had been decided.

The proposal has not been finalized. And while News Corporation’s patriarch, Rupert Murdoch, has softened his longstanding opposition to the plan, he has not signed off on it, the person said.

A number of factors remain to be resolved, including which operations would go into which entity, and — perhaps more important — which executives would head which businesses.

Still, an announcement about the corporate breakup could come as soon as this week, this person said.

“News Corporation confirmed today that it is considering a restructuring to separate its business into two distinct publicly traded companies,” the company said in a statement on Tuesday.

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Media Decoder Blog: Fighting Antipiracy Measure, Hackers Click on Media Chiefs

The hacking group Anonymous posted online the personal details of Jeffrey L. Bewkes, left, the chairman of Time Warner, and also leaked information about the family of Sumner M. Redstone, right, who controls Viacom and the CBS Corporation.Mike Segar/ReutersThe hacking group Anonymous posted online the personal details of Jeffrey L. Bewkes, left, the chairman of Time Warner, and also leaked information about the family of Sumner M. Redstone, right, who controls Viacom and the CBS Corporation.

The online activist group known as Anonymous, which has targeted opponents of the Occupy Wall Street movement and businesses that stopped providing services to WikiLeaks, has set its sights on a new adversary: media executives.

In protest of antipiracy legislation currently being considered by Congress, the group has posted online documents that reveal personal information about Jeffrey L. Bewkes, chairman and chief executive of Time Warner, and Sumner M. Redstone, who controls Viacom and the CBS Corporation. Those companies, like almost every major company in the media and entertainment industry, have championed the Stop Online Piracy Act, the House of Representatives bill, known as SOPA, and its related Senate bill, called Protect I.P.

The documents, culled from various databases, included Mr. Bewkes’s home addresses and phone numbers, and encouraged users to bombard the company and its executives with e-mails, faxes and phone calls. Mr. Bewkes has received intimidating phone calls and a barrage of e-mails, according to supporters of the legislation who have knowledge about the matter but are not authorized to discuss the matter publicly.

The documents also included the corporate contact information for a range of companies including NBCUniversal, Sony Pictures Entertainment and the Walt Disney Company.

A Disney spokeswoman said neither the company nor its chief executive, Robert A. Iger, had received threats. Time Warner declined to comment. The file that was posted regarding Mr. Redstone has details about his family, home and career but does not include private contact information. A Viacom spokeswoman declined to comment.

Anonymous, a loosely organized collective of so-called hacktivists, has called its effort “Operation Hiroshima.” It began on Jan. 1, when the group dropped a trove of documents on Web sites that facilitate anonymous publishing, like and The documents included information about media executives and government figures like Mayor Michael R. Bloomberg and New York City Police Commissioner Raymond W. Kelly, and data on corporations and government entities that the group opposes.

“They should feel threatened,” said Barrett Brown, a Dallas-based online activist who has worked with Anonymous, referring to backers of the antipiracy legislation. “The idea is to put pressure on the politicians and companies supporting it.”

The online effort underscores how heated the arguments have become over legislation that may seem like arcane government regulation. Media companies say the legislation, which has bipartisan support, will crack down on illicit downloads of movies, music and television, especially from overseas Web sites. SOPA would expand the ability of the government and private companies to hold Web sites responsible for content the companies believe infringes on their copyrights, allowing greater use of court orders and lawsuits that could ultimately shut down the sites.

The technology industry, including giants like Google and Yahoo, and advocates for Internet freedom say the bills would censor the Internet, stifle free speech and give the government too much power to regulate and shut down Web sites in the United States. Both sides have spent millions on lobbying in Washington. But at the grass-roots level, the issue has galvanized Internet activists, who lack lobbying power but have promoted the cause among the online community.

“You take our speech, you take our Internet, you take our Bill of Rights, you take our Constitution, we fight back,” said a monotone voice on a YouTube video posted by Anonymous before the Operation Hiroshima document drop.

Lawmakers and their aides have also been targets. A photograph of a 25-year-old aide for the House Judiciary Committee was superimposed into pornography by a group related to Anonymous, according to another aide who was briefed on security threats to lawmakers and their staffs. “Why can’t they just hire a lobbyist like everyone else?” this aide said.

The vast majority of SOPA opponents convey their views through legitimate means. Hundreds of Web sites have encouraged blackouts and boycotts to protest the legislation. According to, nearly 12,000 users have changed their Twitter profile pictures to a “Stop SOPA” badge.

“The more outrage expressed on the Internet in the coming days, the better,” said Fred Wilson, a managing partner at Union Square Ventures, a venture capital firm and an early investor in Twitter. He said he did not condone threats or “any kind of intimidation” by hackers.

Last month introduced a function that made the words on documents gradually fade away. As they did, a pop-up prompted users to contact their representatives. “Don’t let the Internet vanish before your eyes,” it read.

The tactics have succeeded in some cases. Initially a supporter, the Web hosting company Go Daddy reversed its position on SOPA after Wikipedia and thousands of other Web sites said they would withdraw their domains from the service. “Go Daddy will support it when and if the Internet community supports it,” Warren Adelman, Go Daddy’s chief executive, said in a statement.

Companies like Time Warner, which owns HBO, CNN and the Warner Brothers studio, and Viacom, which owns MTV and the Paramount studio, have experienced security teams, but they are not necessarily trained to handle anonymous online threats, said Josh Shaul, chief technology officer at Application Security Inc., a New York-based provider of database security software.

“It’s easy to get something taken off a Web site, but it’s impossible to erase things off the Internet,” he said.

Less than a week after the Operation Hiroshima documents were posted, a Twitter message linking to Mr. Bewkes’s home phone numbers and addresses, his annual income and his wife’s name and age had spread across the Internet. The message included #OpHiroshima, the shortened Twitter code for the effort.

The global activists in the nebulous collection known as Anonymous often use computer skills to support political causes. For example, Anonymous demanded a full Christmas dinner for Pfc. Bradley Manning, the former Army intelligence analyst who is in prison facing charges of leaking classified documents to WikiLeaks.

Last month, hackers associated with Anonymous published a trove of e-mail addresses and the personal information of subscribers of Stratfor, a security group based in Austin, Tex. Last year, a splinter group affiliated with Anonymous attacked the Sony Corporation, shutting down its PlayStation online network. The attack cost the company around $171 million, according to industry estimates. Movements like Anonymous often squabble among themselves, but SOPA is a uniquely unifying cause, said Gabriella Coleman, a professor at McGill University and an expert on hacking. To these activists, she said, “Internet freedom is not controversial.”

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