Because NBC Could Never Have Figured Out How To Put TV Shows On The Internet By Itself...

from the lawsuit-insanity dept

Mon, Mar 29th 2010 11:30am — Mike Masnick

I've been pretty hard on NBC Universal and its partially owned subsidiary Hulu for some consistently poor strategic decisions making over the years, but this recent lawsuit against them seems pretty ridiculous. AdamR points us to the news that a company you probably haven't heard of called Hulavision (its founder is Errol Hula -- get it?) is suing NBC and Hulu claiming that they stole the idea for Hulu and the name. The details of the case don't look much more convincing:

Hulavision and principal Errol Hula claim that the company developed technology to deliver television programs directly to viewers online. Hula then met with NBCU business development exec Raymond Vergel de Dios at a Las Vegas trade show and was invited to have further discussions about working together. In the spring of 2006, Hula and NBCU allegedly signed a nondisclosure agreement, after which Hula revealed his company's business model, marketing strategy, product roadmap and a "shared revenue model chart" that included valuable trade secrets.

Yes. Apparently he seems to think that the concept, technology and business model of taking TV shows and putting them online is his and his alone. As if NBC wasn't likely to figure out how to take video and put it online. And, really, if they were going to take the name from Hula, you'd at least think they'd use a name that was a lot more indicative of video online. There is simply no benefit at all to NBC purposely trying to take Hula's name for Hulu.

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Filed Under: online video, trade secrets, video
Companies: hulavision, hulu, nbc

33 Comments

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aguywhoneedstenbucks (profile), 29 Mar 2010 @ 10:40am

The Hulu Name
Where did Hulu get its name? What does Hulu mean?
There’s no definition of the word "Hulu" in the English language, but it took us as an inherently fun name, one that captures the spirit of the service we're building. Our hope is that "Hulu," as an empty vessel, will come to embody our (admittedly ambitious) never-ending mission, which is to help you find and enjoy the world's premier content when, where and how you want it, for free.
When the name Hulu was first considered, it was discussed in the context of its Chinese translation (as several Hulu employees are of Chinese descent).

Two interesting translations of "hulu" in Mandarin:

A gourd. In ancient times, the gourd was used in China as a "holder of precious things". That appealed to us given the premium content-focused mission of Hulu.
Interactive recording (which is a secondary definition).

So is this guy saying his head is an empty gourd?
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Joe Schmoe, 29 Mar 2010 @ 11:54am

I'm still trying to get past the notion of NBC (or any network) getting past themselve long enough to develop the technology or the business model to put content online...
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Michial Thompson, 29 Mar 2010 @ 11:54am

I can't speak for this one specifically, but...
Just saying that NBC would have figured it out on their own and dismissing this guys claim is pretty unfair. A lot of work and 10s of thousands of dollars can go into developing a business plan and soliciting business such as NBC.

*IF* NBC used this guys business plan/model and developed Hulu from it then he has a right to recover his expenses.

I've been in a situation where this happened. A company I proposed to purchase their software division from took my business plan and turned me down and tried to incorporate it into their next product line.

Thankfully I was able to better implement my plans and develop my own business and compete in the market place against them. In this guys case he may not have been so fortunate.

It sucks to see your work implemented under someone elses name, but it's a risk you take when dealing with big business.
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- Ima Fish (profile), 29 Mar 2010 @ 11:57am
  
  Re: I can't speak for this one specifically, but...
  "*IF* NBC used this guys business plan/model and developed Hulu from it then he has a right to recover his expenses."
  
  No he does not. Putting aside business model patents, because there is no allegation that Errol Hula had any such patents, there is nothing under the law requiring payment for using someone else's business model.
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  - Anonymous Coward, 29 Mar 2010 @ 12:17pm
    
    Re: Re: I can't speak for this one specifically, but...
    The issue about the patents may be / is true. And that backs up what you say about nothing under the LAW for using someone else's business model. But there may be a little devil in the details of that Non-Disclosure Agreement. That is a whole other kettle of fish.
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    - Ima Fish (profile), 29 Mar 2010 @ 12:25pm
      
      Re: Re: Re: I can't speak for this one specifically, but...
      I'm only responding to what Michial Thompson wrote, I'm not arguing that in our infinite universe there is not any possible cause of action.
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      - Anonymous Coward, 29 Mar 2010 @ 1:04pm
        
        Re: Re: Re: Re: I can't speak for this one specifically, but...
        Well since MT's comment was based on Mike's initial posting, and that did have the NDA as a pertinent fact of this issue, it seems to me that it is more than a little bitty thing in the infinite universe. It's pretty damned important. In fact, the case most likely hinges on this.
        
        But hey, if you want to remove things from context in some zeal to prove a point, that's your call.
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    - Michial Thompson, 29 Mar 2010 @ 1:59pm
      
      Re: Re: Re: I can't speak for this one specifically, but...
      You are right, there is nothing in the law that gives him specific rights to recover hit costs, BUT most NDAs, or at least all that I have signed, prevent the other company from taking your ideas and implementing them.
      
      In my case it cost me close to $50k to pay for research and professional writers to put my business plan together, not counting the endless hours of trying to communicate my full idea to these people to get it written. When that company tried to use my business plan in the market place my knee jerk reaction was to take them to court.
      
      But I had the insight to know that they could never pull it off because my plan was based on a much smaller and more efficient management staff and not the big corporate mentality. So I competed in the market place and eventually still bought the division of that company, just for half a million less than my original offer.
      
      In this guys case as someone pointed out, the value of his business plan depended on access to the content that was to be delivered which is why he supposedly went to NBC with the plan. Without the backing of one of the big networks it's not likely that anything like Hulu could exist without nonstop litigation.
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- Hephaestus (profile), 29 Mar 2010 @ 12:09pm
  
  Re: I can't speak for this one specifically, but...
  "It sucks to see your work implemented under someone elses name"
  
  I have a business plan I have been developing for the past year. It contains checklists, time lines, software development, contacts, etc. Basically its a simple way to take on the recording industry and any of the other big media players. If you want its yours to do with as you see fit. I would love to see it implemented ... do a global search for "note/entry" in the comments here at techdirt that will give you a basic Idea of what the components are.
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- Ima Fish (profile), 29 Mar 2010 @ 12:23pm
  
  Re: I can't speak for this one specifically, but...
  "It sucks to see your work implemented under someone elses name"
  
  Yes, competition sucks. But it's a fact when operating a business in a free market. Well, it used to be until the government granted monopolies associated with copyrights and patents starting getting out of control.
  
  For example, McDonalds took the fast food approach used by others, e.g., White Castle has been around since 1921, competed with those other restaurants, and built an empire on that competition. Nowadays the fast food business model would have been patented and McDonalds would not have been able to even attempt to compete. They would have been sued.
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  - bishboria (profile), 29 Mar 2010 @ 12:30pm
    
    Re: Re: I can't speak for this one specifically, but...
    "Nowadays the fast food business model would have been patented and McDonalds would not have been able to even attempt to compete. They would have been sued."
    
    Or fast food industry reps would lobby the government for bailout money if they could no longer compete! Maybe they are... I'm not sure! :)
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- Ryan, 29 Mar 2010 @ 1:22pm
  
  Re: I can't speak for this one specifically, but...
  The work and money he put into a presentation isn't really relevant to the question of whether Hulu was made possible by Hula's alleged innovation. I could spend a lot of time and effort taking a dump all over my house, but that doesn't mean I'm entitled to have somebody pay for the cleaning expenses.
  
  What I don't understand here, and I think the same goes for everyone else, is how anything on Hulu wasn't completely obvious or derivative. The value in the site is in the content and the copyright law providing legal exclusivity; otherwise, all that traffic would have merely remained on YouTube. Did this guy tell NBC how to make tv shows? Was it that it might be a good idea to put those shows on the internet? Or maybe it was the idea that money can be made by showing "commercials" during breaks in the show? I'm really interested to hear what part of Hulu's business model was made possible by this meeting...
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- The Infamous Joe (profile), 29 Mar 2010 @ 1:34pm
  
  Re: I can't speak for this one specifically, but...
  Just saying that NBC would have figured it out on their own and dismissing this guys claim is pretty unfair.
  
  I'm sorry, what? Adding "on the internet" does **NOT** make something new.
  
  I've got a swell idea! Let's put movies... on the internet! No one will make that mental jump, amiright? Or, hey shopping for clothes... on the internet! Brilliant! Let's put the news... on the internet! Dating... on the internet! No, wait, radio... on the internet!
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  - aguywhoneedstenbucks (profile), 29 Mar 2010 @ 2:51pm
    
    Re: Re: I can't speak for this one specifically, but...
    Porn...on the internet!
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Sean, 29 Mar 2010 @ 12:14pm

Hephaestus - I guess you're only willing to give it away because it's worthless. Unlike this guy, whose idea was actually very good.
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- Ima Fish (profile), 29 Mar 2010 @ 12:27pm
  
  Re:
  " guess you're only willing to give it away because it's worthless"
  
  So you're saying that if I price my shit at 100 bucks an ounce, suddenly it will not be worthless? To put it another way, that concepts such as value and worth are set by the mere price put on the object or service?
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  - Anonymous Coward, 29 Mar 2010 @ 12:33pm
    
    Re: Re:
    You stole that idea from this guy:
    
    http://en.wikipedia.org/wiki/Artist's_shit
    
    On May 23, 2007, a tin was sold for EUR124,000 at Sotheby's, and in October 2008, tin 083 was offered for sale at Sotheby's with an estimate of GBP50-70,000.
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    - aguywhoneedstenbucks (profile), 29 Mar 2010 @ 2:52pm
      
      Re: Re: Re:
      That guy stole from Simon Travaglia. The BOFH was licensing his excrement as early as 2004:
      
      http://www.theregister.co.uk/2004/03/09/bofh_protecting_bodily_waste/
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      - BearGriz72 (profile), 29 Mar 2010 @ 5:05pm
        
        Re: Re: Re: Re:
        ROFLMAO
        
        {Insert **AA Joke Here!}
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      - Anonymous Coward, 29 Mar 2010 @ 7:43pm
        
        Re: Re: Re: Re:
        http://en.wikipedia.org/wiki/Piero_Manzoni
        
        In May 1961 Manzoni created 90 small cans, sealed with the text Artist's Shit (Merda d'Artista).
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- Anonymous Coward, 29 Mar 2010 @ 12:59pm
  
  Re:
  "Unlike this guy, whose idea was actually very good."
  
  And you know this...how?
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- btrussell (profile), 29 Mar 2010 @ 3:28pm
  
  Re:
  Just like Linux and all OSS right?
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Sergio, 29 Mar 2010 @ 12:43pm

TV
Did these sorts of issues come up when TV was invented and people were transitioning radio shows to television?

This seems like even less of an issue because you're just delivering content over another communication medium. If the bandwidth was there, you could push shows to someone's home phone. Heck, in the future, when thin bendable screens and powerful microprocessors become so affordable that their fairly disposable, you could snail mail a TV show to someone (why? No idea, it's just an example of pushing content over a different communication medium).
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interval, 29 Mar 2010 @ 1:23pm

His Alone
"Apparently he seems to think that the concept, technology and business model of taking TV shows and putting them online is his and his alone."

No, of course not. Its just another blatant money grab by someone who can't innovate.
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Jim, 29 Mar 2010 @ 1:34pm

Impossible to say...
You don't know the "details" of the case, Mike. All you've apparently seen is an article in THR. It might be about things that you just don't understand. And there is a HELL of a lot more to setting up a site like Hulu than just putting "TV shows on the Internet."

It looks to me that there's at least a possibility of validity. Just the name similarity, business model and NDA alone is enough to give heartburn any in-house counsel I've ever worked with.

A similar thing happened to me once. I did a disclosure to a very big computer company. Two years later I read patent applications with my inventions that we're filed by the people I presented to just days after the presentation. I'm not a big fan of patents or IP in general, but if you snooker someone into showing you their work by giving them an assurance that you won't use it, but you do, then you should be screwed to the wall.

You might be right, Mike. It could be ridiculous. But you just don't know until the facts are out.
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Tom Landry (profile), 29 Mar 2010 @ 1:39pm

I don't wholly disagree but given that we don't know the specific details of what Hula showed NBC back then I'd say you might be overgeneralizing and jumping the gun a bit Mike.
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mrtraver (profile), 29 Mar 2010 @ 1:43pm

This sounds familiar...
...wasn't this an episode of "Seinfeld"?
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Richard (profile), 29 Mar 2010 @ 1:48pm

Surely this guy should be suing the scene "pirates", you know, the ones who for many years before Hulu were putting up TV shows.... on the internet!
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PRMan, 29 Mar 2010 @ 2:21pm

The NDA most likely prevented this...
I typically agree with you Mike about patents vs. competition (especially in software).

But in this case I just can't agree, and neither will the jury.
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Anonymous Coward, 29 Mar 2010 @ 2:45pm

The answer here likely lies in the details of the contracts (including the NDA) between the parties in question. Since we don't really know anything about it, this is all speculation.
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Anonymous Coward, 29 Mar 2010 @ 6:05pm

"As if NBC wasn't likely to figure out how to take video and put it online."

Never underestimate mainstream media stupidity.
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Judson, 8 Apr 2010 @ 7:42am

I can't believe this! LOL even a 10 year old can do this.
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new, 30 Apr 2010 @ 11:37am

Oi galera, gostaria de uma ajuda, eu adquirir um pacote de TV HD no PC no site www.tvhd.com.br tenho acesso a vários canais através de um painel de controle que eu visualizo no próprio navegador, como eu faço para gravar os programas e série de TV no meu PC, lembrando que não tem nem um programa instalado no meu PC é todo pelo próprio navegador.
Quem tiver uma luz por favor me ajude meu e-mail: duvalino_2222@ig.com.br
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