Disney’s Hulu Deal Hurts YouTube

Disney’s new deal with Hulu to put their ABC shows on the site may hurt YouTube, which is owned by Google and has a revenue-sharing busines model, reports The Wall Street Journal. Google has felt pressure over the last several months to add better content to YouTube.

Disney’s deal with Hulu gives the site the right to distribute ABC’s content in exchange for a 30% stake in the company. Hulu already has deals with NBC and News Corp, which owns Fox. The deal with Disney further shows analysts that companies want more control over content distribution and involvement in the sites that YouTube allows. Although YouTube is still the king of video content in terms of traffic, many suspect that they’ll incur huge losses in 2009, while Hulu is gaining steam.

YouTube does have some deals in place to help attract more traffic, advertisers, and better content providers. Two of the top content providers found on YouTube are Sony Pictures Entertainment and MGM Studios. Disney hasn’t stated why they chosen Hulu over YouTube, but a Google rep has said that they weren’t willing to offer an equity stake in the company.

Picture via Hulu.com.