Hulu is often heralded as the perfect example of how to make premium online video content work: a clean, “well-lit” platform for brands, favorable revenue-sharing terms for content providers, and a growing audience of ravenous video-viewers. But is Hulu’s business model all its cracked up to be? Panelists at Digital Hollywood bantered about what’s behind the Hulu hype.
Did Hulu make it “safe” for advertisers to work with online video content? Yes, according to Mark *Marvel*, msnbc.com’s senior director of video monetization. “It allowed TV advertisers to ‘buy brand’ against shows on the web. That shifted a ton of money online — and that’s why it’s the model we’re all stuck dealing with in slightly different ways.”
But was it really a “shift” in the market, or just an expansion? Online video advertising existed before Hulu. Kevin Yen, YouTube’s director of strategic partnerships, questioned whether the rival video site was getting too much credit. “They’ve been good for the online video business, so kudos to them. But there’s really been no insight into how well they’re doing financially. It’s not clear that what you’re reading in the press is their financial reality.” (Pot calling kettle black, anyone?)
Meanwhile, MTV’s EVP of digital ads Nada Stirratt questioned whether online video providers (even a company that has been TV-centric, like MTV) should even be trying to emulate TV’s content and monetization models on the web: “If someone really wants a TV experience, they’ll watch TV. And TV’s great for that. But the reason people go on the Web is for an engagement experience — being able to interact with other viewers, get commentary, see archives — and Hulu doesn’t complete that. It will be interesting to see what Hulu looks like in 18 months.”