On Thursday, outgoing Hulu CEO Jason Kilar wrote on the Hulu blog that Andy Forssell would be taking over as interim CEO.
The move was not a surprise. During my reporting last year on a feature about Hulu’s uncertain future, sources told me that Forssell was very well liked amongst studio and network brass. He made an effort to be more of a diplomat and was perceived as less of Hulugan than some of Kilar’s inner circle.
“There are many ways to look at my bio and think it makes no sense what I’m doing,” Forssell told me last summer, referring to his role as SVP of content. He earned a BS (with honors) in electrical engineering from Carnegie Mellon University, a BS in Russian studies from the United States Military Academy, and an MBA from the Harvard Business School, then spent a decade in leadership roles at Siebel Systems and Oracle Corporation. On Thursday, Kilar credited Forssell with growing content partners from two to more than 450 and helping Hulu grow to earn roughly $700 million revenue in 2012.
The question is, without Kilar steering the company’s vision–often willingly playing the role of the maverick setting fire to network legacy systems and dragging Hollywood into the digital age–will Hulu be able to carve out a future?
In revisiting my interview with Forssell last year (Hulu’s not the only one finding value in back catalogs), he spoke at length about the challenge of disrupting the Hollywood-driven TV and movie business, about dealing with partners in those businesses, and the ways in which content will drive Hulu’s future. (He’s the senior content guy at this point, remember.) Although he was talking about a Hulu that’s since gone through sweeping changes, his vision will surely have an impact on the way he or a more permanent CEO will steer the company.
“You’ve got to have someone who’s as charismatic as Jason, but also has a lot of finesse and who is humble,” Forssell said of this then-boss. “Because we were walking a very fine line from the start to try and prove everyone wrong that you could pull something like this off.”
Here’s a deeper look inside Forssell’s head:
On Partnering With The Industry You’re Trying To Disrupt
“… Being able to put yourself in the other person’s shoes, that’s one thing you’ll hear a lot from us, in using many different words, but we had to balance the interests of content owners, advertisers, and users, and no one would be totally happy, but they all would be better off if we could manage to sort of wind that careful path.
“The challenge is that the rights landscape is complicated for a lot of historical reasons. And it’s changing and it’s simplifying but it’s a very gradual process.
“We think about three constituencies: For advertisers we want to be the most effective advertising service on the planet; for users we want to be the best place to find and enjoy great premium content; for content owners we want to be the best in class as a monetization engine. We want to be able to make it a smart business so they can use our business model.
“Strategies come and go and change with leadership.To get the thing up and running, you need leadership, or else you’ll never get something off the ground.”
New Original Content vs. Nostalgia
“So first of all … we’ve got people that come and spend hours and hours on the site and, if it’s Hulu Plus, the service. So that’s a really great way to introduce things, whether it’s through recommendations, whether it’s through our promo ads, a trailer here, a trailer there, it applies to originals, exclusives, things from Fox, doesn’t matter.
“We’re gonna run a business model, $7.99 a month per user, and we want to run a good, tight, profitable business in the long term. It means we have to make careful decisions about content. In effect we’re doing programming. And once we get into that business, the complexity of what my team does just increased tenfold.
“At certain point once you’re spending hundreds of millions of dollars on content, you face a point where you realize this is great, we’re getting really good stuff. But do I spend $2 million on several seasons of some show from the ’70s that was pretty good, and there are people that love it, there’s nostalgia, or is the smarter choice to go back and talk to a creator, a creative person who was in here last week, who we know, who has this idea that’s not getting made. And at a certain point you’d be crazy not to start to speculate a little bit there… and that’s one thing that perks up our ears. When we hear something doesn’t fit.
“Then you end up with some small piece of content that can only be seen on Hulu, that’s interesting for differentiation purposes. Most of what we do will be stuff that you can continue to find elsewhere. But if you can have that kernel of stuff that people love, that speaks to an audience and is something that they wouldn’t find somewhere else, then that has a lot of appeal.
“One of the reasons we licensed so much from the U.K. is that I think that market’s fascinating. What I’ve always said is they have some of the best TV in the world and some of the worst TV in the world. It’s because they’re constantly experimenting. They do short seasons. They don’t do 22 episodes. They do six or eight. They might have a year or two in between seasons. So it means they don’t always have to be hitting these massive home runs and get a show that’s high in the ratings for 22 episodes and make it to five seasons so they can sell it to syndication. There’s so much more experimentation. I think you’ll see that model proliferate more on the Internet here.
On Hulu’s Programming Sensibility
One thing we’re trying to do is foster creative folks and say, you don’t have to make 22. What is the story you want to tell? If you can do it in five or six or eight, that’s fine. Let’s do it and make it great.
“It’s about relationships and knowing, how do you tap into the next Lena Dunham? In some cases we’re trying to find Lena Dunham at the Tiny Furniture stage.”
“We don’t want to make a difference just with money. We don’t want to make a difference because you can be edgy and use profanity online. There’ll be cases where that’s intrinsic to the show, but we don’t want that to be the major thing to exploit. I think when we think about what we want to do with originals, the first word that always comes up is ‘smart.’ How do you let people do something really smart and let them go target 2 or 3 or 4 million people rather than if you get sucked into going down a network path where you’re going to go larger because they need you to go larger. There’s nothing bad about that, but for certain creators, you can offer them creative freedom and say, ‘We like you because of your specific voice. We’re not gonna try and change that voice. Use that voice and go create that thing.’ We can be smart and ambitious in some way, and we’re still defining all the things that can mean, but we want people to take chances.
“The one thing that, one luxury we have want to zealously maintain, is the idea of patience for these shows. We don’t publish view count numbers. And everybody asks us and I always tell them, continue to ask me, you’d be crazy not to ask me, but I hope I can continue for a long time not telling you the answer because as soon as we start saying, ‘Well, the first week we did X,’ we start going down a path where our marketing has to change.
“Everything we do is over the two-year model…. But I don’t want that to be our world. I want it to be a messy graph. I want it to be unpredictable. Shows are gonna have second and third and fourth lives. And then as you watch subsequent seasons, every season has more people feed into it. You manage to collect fans along the way. That to me is a great outcome. It’s a great outcome for creators. It’s a great outcome for viewers. You’re not wasting a lot of marketing dollars.”
On The Pressure To Make A Hit, Original Show
“There are a bunch of numbers I wish I could release, for a bunch of shows, originals that do numbers that are absolutely on par with basic cable. Great numbers. Others are slower build shows, those numbers are less impressive, but I also believe those shows are the ones that over time will absolutely get to really meaningful numbers. And they’re the shows you have to be patient with.
“I think there’s certainly 5 million people out there in this county really love [Battleground, the Hulu original mockumentary by J.D. Walsh]. The question is does it take us 18 months or does it take us four years?
“In the end, look, I’d love to do an hourlong sci-fi show. We have the audience. But it’s really hard to do that at budgets that make sense not just today but a few years from now. But as special effects get cheaper that will change. Over the next few years, that will change. You’ll be able to do an hour sci-fi show that’s really well done, great writing and great acting, and all the expenses … so I think everything’s going in the right direction.
“I also think we try and stay away from that kind of home-run thinking where you have to throw all the marketing into it because I think it leads to an ecosystem that isn’t good for anybody. We just want creators to be able to tell great stories.
“So sure, of course, we’d love to make a defining show, but is that the goal for the next year or two? No, I think we’d have a lot, there would be quite a bit of hubris in trying to think we could do that.
“I meant what I said when I said we were a strange animal. But I also hope we continue to be a strange animal. I think originals is really important to us, but it continues to be a very small part of what we do in terms of just the bulk and the volume, even as a percentage of the content.
“We are at heart a distributor. We are a service to help people find what they love. That’s what drives us. You shouldn’t have to watch TV that’s just OK. There’s too much that’s great out there. There’s more great story telling out there than ever before.”
Coming Monday: Read more about Hollywood’s transition into the digital world from the April issue of Fast Company.
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