Disney-Hulu Deal Is Ominous For YouTube

Hugh Pickens writes "Dow Jones reports that Hulu scored a big victory when Disney agreed to take a nearly 30% stake in Hulu and put full episodes of its ABC TV shows on the site, enabling users to see shows like Lost, Scrubs, Ugly Betty and Desperate Housewives for free. Disney views the move as a way to reach a new audience that isn't coming to the network's own website. Although the ABC.com website has attracted regular viewers of its shows, Hulu offers the opportunity to tap into a new group of viewers. Now Google is under mounting pressure to add more professional content to YouTube in order to attract more advertisers. According to Dow Jones' Scott Morrisson, the equity structure of the Disney-Hulu deal suggests that content creators want greater involvement in online distribution than Google has offered with YouTube. 'Content providers don't want to give (YouTube) content because the advertisers aren't there yet,' said Edward Jones analyst Andy Miedler."

Comments

Bollocks

[tpgp]

Youtube's value is in the long tail - Hulu doesn't seem to be going down that path.

Re:Bollocks

[Tubal-Cain]

Youtube's value is in the long tail.

And it's losing money at the rate of one Library of Congress. ($half-billion a year)

Google Ads

[olddotter]

I don't see why google doesn't just put some basic google text ads on the right of youtube served up based on the description of the video and the content of the comments. Heck I just went there now and saw an ad for Civony (http://www.civony.com/tour.php). So whats the problem? Not enough ad revenue to offset the bandwidth charges?

Digging their own graves?

[mister_playboy]

I am eager to see the old cable subscription model fail, so we can actually have some decent internet speeds here in the US. If these companies have trouble monetizing this new approach, that won't exactly break my heart, though.

Re:Digging their own graves?

[Jeff DeMaagd]

If these companies have trouble monetizing this new approach, that won't exactly break my heart, though.

Would it though, if they had to cancel your favorite show because there just isn't enough money to justify making it?

I mean, your attitude is basically demanding that the show producers take a 90% cut in revenue or else you're not happy.

Most viewed debacle

[computerMechanic]

The major downside to this deal IMHO is the disappearance of the most viewed categories from both youtube and google video. Now we have the Most Popular categorie which consists of fred, disney, american idol and the like. I miss being able to look up a list of most viewed, by country and date.

Re:Available outside U.S. ?

[TheRaven64]

I was surprised to click on the YouTube shows and movies links above and find that they actually worked here in the UK. The content selection isn't huge, but combined with iPlayer there's probably still more than I have time to watch. There isn't even any point in pirating content that the studios don't make available over here - there's already more stuff available legally than I have time to watch, and if they don't want to make their products available to me then I won't go out of my way to see them.

Hulu == Intrusiveness.No && OldBoxSupport.

[N!NJA]

i never watched videos at ABC.com because the site always required more than i was willing to install (or mess) in my PC. i just decided to give them another try and see what their current requirements for streaming videos are.... and guess what? surprisingly -- they changed it! however -- not surprisingly -- the new requirements are still too restrictive. currently, their videos wont play (and, given their nature, that really isnt any loss) just because i'm a happy user of Win2000.... O.o

TNT is another loser who will eventually take their content to Hulu. on TNT.com the user is required to install some Microsoft DRM plugin crap.... those companies shoot themselves in the foot when they make their sites so picky! with Hulu, it just works! you only need a browser (ANY!) and the Flash plugin. it has never asked me to install anything! btw, YouTube and PBS have got some shows online as well....and they also just work!

the other thing i like about Hulu is their choice of Flash player. it exposes the QUALITY options (HIGH, MEDIUM and Low), which can be the difference between a choppy and a smooth playback. i hope they dont remove it (seems to be the trend)!

what's with that anyway? many websites are doing away with the QUALITY option and just imposing the (more resource-intensive) HIGH setting! geez, sometimes that setting makes Flash just plain unwatchable in my Athlon 3000. why are developers removing an option that is actually useful?!?! it was fine the way it was before when it defaulted to HIGH but let you change it. what's next? are they going to remove the FULLSCREEN option too?

and no, kid! i'm not gonna retire my perfectly functional Atlhon 3000.... or my Pentium 3 700MHz! now get off my lawn!

Re:One Simple Solution

[RiotingPacifist]

While i agree that youtube is a completely different platform to hulu, i think youtube is going to run into problems if it doesn't change its ways soon. In looking to get commercial content providers on-bored they stopped protecting their users and will take down just about anything instantly, this is loosing them users, who either go elsewhere (dailymotion, etc) or just using online videosites much because they can't find what they want. By shutting down the accounts of high volume user that infringed copyright and/or offended xenu, they have clearly reduced their user base significantly. Given the safe harbor provisions in the DMCA, the only reason to become so pro-active is to appeal to the content providers, at the cost of pissing off their userbase.

While this is clearly hurting youtube, as im not google all i can offer in the place of evidence is an anecdote. I have a friend who uploads highlights of wrestling videos with old video games as the soundtrack, at some point last year he got his account closed down for copyright infringement. He set up a second account and since then he has made it into the top 100 subscribed channels a few times, however his old channel had something like 10 times as many subscribers. Now even if what he was doing wasn't fair use (not having seen them i cant say), youtube could have just taken off the offending videos while leaving his account open.

defective by design

[kingduct]

I tried using Hulu. It was designed not to let me press the pause button and let the entire show download over my cheap DSL (my usual practice with any flash videos that are higher bandwidth than my internet). It would only buffer the next several seconds, I assume to prevent me from downloading the entire file. I never went back and had to go back to using other sources of television that exist online...

Available outside Redmond?

[Anonymous Coward]

You get a funny , but remember your addiction is a win for American culture. Big media doesn't need to change it's business model when purveyors of what it has to offer can't "quit anytime it wants". Much like a certain other monopoly.

Not a solution

[AliasMarlowe]

http://www.youtube.com/shows http://www.youtube.com/movies

Youtube sucks just as much as Hulu sometimes:
This video is not available in your country
That was for "The Outer Limits", "Married with Children", "The Addams family", and "Terry Jones' Medieval Lives". There may be some shows available in my country, but I gave up trying at that point.

Re:One Simple Solution

[harlows_monkeys]

The problem is making money. Yes, Youtube is popular, but is it profitable yet? I don't know. Advertisers won't pay much on ad space until they can place their ads on premium content, and they won't be able to get premium content until they can show that advertisers are willing to pay a premium. It's a catch 22.

Estimates vary, but most analysts put YouTube's loss to Google at between $250 million and $500 million per year, with the bulk of that being due to bandwidth costs. The big problem is almost no one wants their ads on user supplied content.

Suppose, for instance, you were a company like Purina. You are interested in advertising your cat food. If you told Google to show your ad on videos that match the keywords "cat" and "cute", sure, you'll get a lot of impressions on videos of nice cats doing cute things. And you'll also get on videos of cute cats getting run over by lawn mowers, sticking paws in garbage disposals, and so on. Purina does NOT want to be associated in any way with running cats over with lawn mowers.

One article I read, if I recall correctly, said that Hulu is already getting more advertising revenue than YouTube, despite only having a fraction of the visitors YouTable has.