Former Hulu Head Jason Kilar’s Stealth Startup Pitches Magazine Publishers
Jason Kilar made a big splash in Web video and TV when he ran Hulu.
Now he’s trying do the same thing with Web publishing and magazines.
Kilar has yet to talk publicly about The Fremont Project, the startup he began staffing up last fall. But in recent weeks he has been talking to big publishers about his plan: He wants to create an app that offers a collection of “premium” magazine and newspaper content, along with digital extras like videos, and lets readers pick and choose the stuff they want.
If that sounds familiar, that’s because lots of people have tried versions of this. Flipboard, for instance, lets users assemble their own “magazines” by picking articles from various digital sources. And publishers themselves have funded Next Issue Media, a “Hulu for magazines,” where readers can subscribe to multiple titles on their iPads for a single subscription price.
The difference in Kilar’s pitch, say people who have heard it, is that he wants to create a new “window” for publishers’ stuff. The idea is that after publishers distribute a print and/or digital version of their content for their subscribers, Kilar’s company would get exclusive digital rights for a period. Eventually publishers could distribute their stuff on the open Web if they wanted.
Sources say Kilar is also playing up the idea that his team, which includes many of his former Hulu employees, will be able to showcase publisher’s stuff in a way that makes it more appealing. “He would like to adapt the content to make it more ‘Snow Fall’-like,” said one source, referring to the New York Times’ heralded multimedia project.
Kilar and JP Colaco, who ran sales for Kilar at Hulu and has rejoined him at The Fremont Project, have been making trips to Manhattan to court various publishers, including the New York Times, News Corp., Hearst, Time Inc. and Conde Nast.
People familiar with the discussions say the two men are pitching a business model similar to Hulu’s: It would have a “dual revenue stream” featuring both ads and subscriptions. And both Kilar’s company and publishers would be able to sell ads against the content.
One big difference, presumably, from Kilar’s last company is that Hulu is owned and controlled by its primary content suppliers (21st Century Fox, Disney and Comcast*) — a structure that led to a rift between Kilar and his backers when he ran the company. And in this case, this will be Kilar’s show.
When Kilar left Hulu last spring, he departed with a hefty payout after converting his equity stake into cash; I don’t believe he has looked for venture funding for Fremont so far.
Another big difference between the two projects is that TV was and is an industry that has yet to be fundamentally disrupted by technology. But big print publishers have already seen much of their power, and revenue, erode.
That makes Kilar’s approach seem odd at first blush. But the counterargument is that the biggest publishers are still very big — Time Inc. generated $3.4 billion in revenue last year — and that no one has really figured out how to make the most of them on a digital platform yet. “Jason thinks huge,” said a person familiar with his company. “To sniff around what he’s doing, you have to think big.”
Everyone I’ve spoken with who knows about the talks says they are preliminary — I don’t believe anyone has seen a functioning demo of the app/service. Financial details also seem rough, though one publishing source suggests that the idea is to build a very big platform business, with relatively low margins, and pass the majority of the revenue back to publishers.
But people who’ve talked to Kilar seem intrigued by the pitch, at the very least. “I love that a really smart guy is trying to do something innovative with premium content,” said a publisher who has met with him. “That’s really cool.”
*Comcast owns NBCUniversal, which has invested in this site.