Providing an online distribution platform Hulu is both free and legal, and offers access to a wide range of content supported by advertising. While popular with consumers it's not yet delivering the big bucks for the studios.
As Professor Cunningham points out. 'It's quite successful in the US, but it's not making money for them. It's a case of analogue dollars and digital cents.'
Meanwhile the big studios' traditional revenue streams are under assault. 'Cinema admissions in North America have declined from 5.2 billion to 3.9 billion annually in the last ten years and DVD sales are also in steep decline,' according to Professor Cunningham.
In Australia, according to Screen Australia, the proportion of people attending the cinema at least once a year was 72 per cent in 2004. By 2010 that had fallen to 69 per cent. The frequency of attendance also fell - down to 7.3 per visits per year compared to 7.8 in 2004.
The winners from this digital dislocation are likely to be the smaller content creators, who will be able to use cheaper digital production technologies and online distribution channels to reach much broader audiences than was previously possible. As a result Hollywood was experiencing a 'period of doughnutting' according to Professor Cunningham - where the big studios were forced to push the budgets and the size of projects to create analogue blockbusters which could spin off sequels and vast marketing empires.