Did Hulu Just “Kick YouTube’s Ass”?
Jun 17th, 2008 | By James Lewin | Category: Internet TV, Streaming Video, Video 
Mark Cuban has a must-read post over at Blog Maverick looking at Internet television service Hulu and Google‘s struggle to make its investment in YouTube pay off.
Cuban argues that Google made a billion-dollar mistake buying YouTube, and that Hulu is “kicking YouTube’s ass”.
It’s an interesting comparison, and one that may provide some insight into the future of video on the web.
A quick look at the two site’s reach suggests that Cuban is insane, and that it’s YouTube that is kicking Hulu’s ass:
While YouTube may have no problem giving away free services, though, Google hasn’t figured out how to make money doing it.
Cuban notes:
Hulu has one HUGE advantage over Youtube, it has the right to sell advertising in and around every single video on its site. It can package and sell any way that might make its customers happy.
Youtube on the other hand, has that right for only the small percentage of the videos on its site that it has a licensing deal with. For probably 99pct or more of the videos on the site, Youtube isn’t supposed to know what they even are.
Hulu’s selling ads on all of its content, while YouTube is trying to figure out how to make money off of laughing babies.
So, while Hulu may only serve up a tiny fraction of the videos that YouTube does, all of Hulu’s have ads in them. Hulu offers advertisers something they know and understand, and that has been proven to work.
Unless Google can prove Cuban wrong, sites like Hulu are going to rapidly give the world of Internet TV a makeover – in the style of traditional television.
I’d love to see a chart for revenues instead of reach. Totally makes sense Youtube has bigger reach (does that include Google Video?). This is that million dollar question of indie vs. major revenues.
Eric
YouTube’s got a problem – most of the stuff that gets watched on the site is either pirated or risque, and it scares advertisers off.
YouTube is going to have to figure out a way to separate the wheat from the chaff, or sites with known content that has a proven track record are going to eat its lunch.
Why did you use Alexa to back up your point? A flawed data source does not help your argument.
Why not Compete or Quantcast, if you’re looking for up-to-the-minute stats.
Eric – here you go:
link for Eric
No matter what analytics source you use, you have to understand it with some context of where the data is coming from. They are all flawed.
Most, if not all the Hulu content cannot be seen outside the USA. = fail (for now)
– but their platform and model looks great for here (in the UK)
K
edit: – but their platform and model looks great *FROM* here (in the UK)
[…] YouTube’s ass,” a theory that has been getting some reaction from various places in the blogosphere today. The reason for the post would be fairly obvious to regular readers of Blog Maverick even if […]
How many users do Hulu have?
who’s going to watch ads on Hulu?
With a small user base, it’s not going to attract advertisers.
google doesnt want to make money with YouTube while Viacom is suing them for $1B and even worse, possibility it could change DMCA… wait till the lawsuit is over and they start to monetize it.
Kosso – that’s a really good point.
While Hulu is tackling publishing legal, easily monetizable video content that will let it generate income right away, it’s going to have to deal with a lot of issues in order to do this internationally, from rights to broadcast to getting local advertisers.
Chris –
According to Google CEO Dr. Eric Schmidt,
Figuring Out How To Make Money From YouTube Is Google’s Top Priority .
YouTube’s biggest problem is that a large percentage of their views aren’t on the YouTube website. With all of the embedded videos on websites they don’t get the ads in the face of the viewers.
Let’s think about other markets Hulu may cut into: DVR. As people are now turning to Hulu to watch shows they “missed,” will the DVR go the way of the VCR? If Hulu is pushing HD shows and programming with minimal commercials, they may attract a group of people (like me) who sometimes forget or are busy doing other things to worry about regular programs. Then on MY terms, I can get caught up with missed episodes.