Is Hulu Eating Into YouTube’s Lunch?

Milo Riano — Tue, 25 Nov 2008 10:45:39 +0000

Charlie Anzman and Allen Stern from InformationWeek has written about Hulu eating into YouTube’s lunch. In their argument, YouTube might have had 700000 viewers during their live event but Hulu showing “real world” shows have millions of viewers.

In an excerpt: So why do I believe Hulu will eat YouTube’s lunch? Easy, Hulu is where the ad dollars will go. If I look back to my days buying millions of dollars worth of media and you asked me which service I’d rather be associated with, the answer is easy… Hulu. The real question for brand marketers is where is the best likelihood for user engagement with my advertising. Viewers of Fred or Justine on YouTube aren’t going to interact with online advertising the same way a mainstream Internet user will. In fact, I’d argue that most YouTube viewers aren’t going to interact with any online advertising.

In fact, online video creators are going to have to work even harder to get brand ad dollars going forward. They are now competing with the biggest stars, movies, and television shows across all time. Buying ads on Hulu is easy and the viewers are there. There will be ad dollars for online video creators, they will just have to hustle for it more than was expected just a couple of years ago.

Charlie Anzman has a good post today on the second reason that Hulu will beat YouTube. He calls it the “real world” factor. Anzman notes, “I spend some (much more lately) of my time in the ‘real world’. I occasionally miss a TV show that I enjoy and I can sit back with my wife anytime and watch that missed episode. It’s really that simple. Hulu’s easy and simple interface is great … and we usually discover something else after.” It’s that “something else after” factor that keeps you hooked to Hulu way more than you will ever stay hooked to YouTube. Hulu also offers a never-ending selection of television programming and full-length movies.

Hulu might be showing “real world” shows; but what is stopping YouTube from organizing their videos and putting more structure that allows “real world” shows on them. Also, they have the audience and potential to create a new kind of celebrity world that could translate into “real world” fame.