Hulu Beats Projections; Toying With HD

Apr 17, 2008  •  Post A Comment

(Corrected at 12:30 Pacific. Eliminate reference to financial goals in first paragraph.)
Jason Kilar, CEO of the Hulu video Web site, said the NBC Universal-Fox joint venture has surpassed its traffic goals in its first month of public operation.
Speaking Wednesday at a keynote address at the convention of the National Association of Broadcasters in Las Vegas, Mr. Kilar noted that online video viewing has tripled in the past 24 months, along with increases in online advertising spending.
Mr. Kilar didn’t provide an answer to a reporter’s question as to when the site might be profitable. He attributed Hulu’s initial success to a meticulous design rubric (“We didn’t want it to look like Tokyo at night… black with lots of flashing lights.”) and a simple mission statement (“To help people find and enjoy the world’s premium content, when, where, and how they want to.”).
Mr. Kilar also described an overwhelmingly positive user response, which he said was grounded in using his computer-illiterate mother as test subject, and using an approach to content straight out of “Miracle on 34th Street.”
“We’re providing the best consumer experience. We’ll send you to Gimbles, anywhere it’s legally available, if we don’t have it,” he said, mentioning Hulu’s 50 provider sources and a content lineup of that has quadrupled in the last four months.
He went on to say that Hulu is a system that rewards innovation and quality in programming, citing the cancelled audience favorite “Arrested Development,” which typically commands the first and second spots in views on Hulu. The shows that draw bigger audiences command higher ad prices, making “Arrested Development” a revenue source that in past years could not have generated new sales.
Mr. Kilar also made the case that Hulu could effectively end entertainment piracy, citing a message from a user who said that the quality and availability of Hulu’s “Arrested Development” archive had caused him to abandon illegal downloading.
Additionally beneficial to the Hulu model is the try-before-you-buy nature of free content. Mr. Kilar read an e-mail from a user who said that he had become a fan of “It’s Always Sunny in Philadelphia” after friends had recommended it.
With the Internet commanding an increasing chunk of user discretionary time, viewers are much more likely to check out a word-of-mouth recommendation as an on-demand program than appointment television or a pay-service like iTunes, he said.
He also intimated that Hulu was investigating new technology in the HD realm, and a possible transition from the computer screen to the comparatively larger television screen. He declined to provide specifics, saying any expansion ideas are still in the brainstorming phase.
Mr. Kilar disagreed with the suggestion that Hulu had not yet proven its mettle as a profitable enterprise. He mentioned that it had avoided typical Web-video pitfalls, for instance, avoiding pre-roll ads in favor of a branded slate. On Hulu, users currently are confronted with one-quarter as many ads as they find on TV, Mr. Kilar said. At the same time, ad prices are higher on Hulu, he noted.


  1. Hulu is a fantastic site, and ARRESTED DEVELOPMENT is the best show we have ever made – hands-down our equivalent to Shakespeare or something. Someone realy should jump on the chance of reuniting that cast and writers while there’s still time, because whatever they have/will produce will live on fr a very long time.
    So I’m glad the service that ‘launches’ Internet TV is doing it hand-in-hand with the best that conventional TV ever offered us.
    Again, bring it back.

  2. I’m not surprised… as I briefly mentioned this BEFORE this article was in print! I used this as an example on how “TV AS WE KNOW IT, WILL DIE”, in the digital transformation article, the other day.

  3. Hulu is awesome. I am willing to watch the same ads for each episode because there are far less of them and I can watch the show I want at anytime.
    As an aside, I went to Chilis because they had an add on Hulu for really thick bacon on their cheeseburger. Who wouldn’t want to watch what they want, when they want AND learn about really thick bacon???

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