Hulu Hullabaloo: Early Reviews Positive for NBCU-News Corp. JV

Online-Video Site’s Ease of Use, Ad Structure Praised

By Anne Becker -- Broadcasting & Cable, 11/3/2007 5:00:00 PM

NBC Universal and News Corp. launched their online video venture, Hulu, this past week to a group of beta-testers, who praised the site for its ease of use and advertising structure. But the group questioned its limitations on content, such as the fact that it can’t be downloaded or viewed internationally.

When the site officially launches in the coming months, it will have about 1,000 hours of content from Fox and NBC, various cable networks and studio partners Sony Pictures Television and Metro-Goldwyn-Mayer. That’s about double what it has now, according to CEO Jason Kilar, who joined the company with several years of experience at Amazon.com.

Hulu will update that content every day, adding new clips as frequently as every 15 minutes. During the beta period, the site will add "tens of thousands" of new users each week, Kilar said.

Early press reviews praised Hulu’s advertising structure -- one that tailors ads to the length of content (short clips generally run with 15-second pop-up ads, while full episodes and movies bear a limited number of 30-second spots).

And while Hulu’s success will hinge on whether it can support itself through ad revenue, that won’t be an issue initially, given the site’s well-publicized $100 million investment from Providence Equity Partners, not to mention the deep pockets of its enormous corporate parents.

"The fact that they’ve raised $100 million and have money in the bank means they’re not going to disappear anytime soon," said online-industry analyst and consultant Dan Rayburn, executive vice president of StreamingMedia.com.