The Hubbub Over Hulu

By Anastacia Mott Austin

This month the online video service Hulu.com, a partnership between NBC Universal and News Corp, hits the net after months of speculation. Currently in the beta stage and only available to a limited number of test viewers, it will slowly add users over the next month and launch to the mainstream in a couple of months.

Originally slated to be a "Youtube killer," naysayers predicted it would be a failure before it even launched. However, early reviews have been promising, and with the site’s focus on "premium" content, it shouldn’t be much competition for Youtube and similar, short-length viewer-produced content.

Having also signed on with Sony Pictures and MGM, the site will feature free, full-length streamed movies as well as premium television shows such as "24," "House," "Monk," "Bones," and "Saturday Night Live."

So what’s so special about the site? The company’s CEO, Jason Kilar, 36, says that Hulu will simply have the largest selection of premium online TV shows and movies available anywhere. "We don’t have to worry about showing TV schedules or letting fans get to know the actors," said Kilar to reporters. "All we have to worry about is the video."

Adds technology columnist for the Wall Street Journal Kara Swisher, on her blog, "Hulu’s willingness to send its content far and wide from the get-go, with very little friction and using easy tools to do so, is perhaps the most compelling aspect of its debut."

Another unique bonus is an easy tool that allows viewers to choose any clip of any show or movie and email it to friends or post it on a blog. "This is a big deal," Kilar told the press. "It is a great way to let users express themselves through our content."

In addition, Hulu works with any Web browser without requiring software downloading.

Viewers watching TV shows or movies on Hulu will still have to deal with commercials, but at a far lower volume than on actual television. Like other streaming video sites, commercials can’t be skipped, but they’re shorter in length than regular commercials, catering to online viewers’ notoriously limited patience and attention spans.

Reviewers have said the site is attractive and user-friendly. "The interface is very elegant," said James McQuivey, Forrester Research analysit, to reporters. The site will also distribute its content to AOL, MySpace, Yahoo, and Comcast.

The additional partnerships with Sony and MGM will provide archived content such as old episodes of "Charlie’s Angels," "Fame," and movies like "The Pink Panther."

So what’s the bad news? For starters, the site won’t have any user-produced video clips, so the comparisons to Youtube are unwarranted. In addition, the site only features five episodes of any given program, so if viewers want content older than that, they’ll have to go elsewhere.

Users who want to embed clips into their blogs may find the wide-screen format difficult to fit into smaller-space blogs, and testers say the videos are hard to resize.

Experts say that the biggest challenge Hulu will face is cost. With demand for high-quality video but without much advertising revenue (most of which goes to its partners), some say Hulu won’t be able to keep up.

"To me, the biggest challenge is economics," agrees McQuivey. "The content is good, and they are distributing it in all the right places. But over time they will have pressure to increase the quality of the streams and that is going to raise costs even more."

But Jeff Zucker, president and CEO of NBC Universal, doesn’t seem too worried about that. "At a minimum it’s another way for us to offer our content to users and get paid for it," Zucker told reporters. "If the site itself does well, that will be gravy on top of it."

Some say the true significance of a site like Hulu isn’t its features, but the fact that "old media" companies have finally caught the wave of the future and are partnering to bring their content to Internet viewers in this way.

Swisher writes, "Finally, someone in Hollywood has realized that ubiquitous distribution, which is being driven by consumers’ desire to move their media anywhere they want, whenever they want, is the future."