6 ms·

Hulu a consumer success but still a small business: Est. $12.5-25mm net revs

12 points by fromedome 18y ago

JimEngland 18y ago
They need to 1) includes ads into small clips (3-5 min) and 2) vary the advertising on full television episodes. Seeing the same Toyota ad seven times isn't helpful to the consumer.
- bouncingsoul 18y ago
  1. They do sometimes have 15 second ads on short excerpts – and I absolutely hate it. The cost just seems way too high for a 1:00 clip. (On the plus side it makes me reconsider if I'm spending my time wisely.) 2. I too don't understand why they play the same one or two ads for the entire movie. It honestly gets annoying, which seems like something you don't want your advertising to do. At this point I just mute them.
- SwellJoe 18y ago
  Seeing the same Toyota ad seven times isn't helpful to the consumer. But it's helpful to the marketer. It takes at least that many impressions to even register. This is actually why I'm surprised by how little money online advertising makes. It would be possible for an advertiser to buy several impressions with the same user--or a series of ads being shown to the same user. Everything I've ever read about marketing tells me this would be more effective than an ad shown to five different people only once. They need to 1) includes ads into small clips (3-5 min) I recently built an HTPC with Media Center. When I first fired it up, I browsed to the "watch TV online" thing...clicked on the first popular clip. 30 second ad. 45 second clip. Never again will I browse to that option on my HTPC. Ever. Anything less than 5 minutes with an ad is gonna piss me off. But, I do love Hulu. The quality isn't as good as I'd like for most of the shows and movies (that HTPC is hooked up to a 46" 1080p TV), and I had to hit bittorrent to catch up on Battlestar Galactica this season when I missed the first couple--they only have the last three or four episodes on Hulu and scifi.com--but I still like being able to catch up on shows at my convenience.
- alaskamiller 18y ago
  The ads keeps getting replayed because they run out of inventory. They had trouble filling in spots for awhile and resorted to running bumps.
coglethorpe 18y ago
How much revenue do they "need?" I know sites cost less and less to operate, and a small team of developers can do a lot.
webwright 18y ago
12-25 million in revenue is staggeringly good for their age. Private beta in Oct 07. Launch in March 08. Assuming growth (which I think they have), I'd call that a pretty amazing success.
- akd 18y ago
  It's a bit different when you're an NBC / News Corp joint venture. The whole issue of getting your name out there, networking, etc. is not really an issue -- the CEO makes 10 phone calls and has all his content lined up. Also the amount of free publicity was massive since NBC and News Corp together control a number of different media outlets, and other news organizations jumped on the bandwagon.
  - alaskamiller 18y ago
    I have yet seen any reference to Hulu on the networks. In fact, Fox prior to this month were still telling people to go to fox.com and use the horrible media player to watch shows on demand. Having the access to that huge library of content, though, makes it pretty darn hard for other companies to play in the field.
    - j2d2 18y ago
      I'd guess they're still building out the library. Much better to make a huge splash than be another youtube.
      - alaskamiller 18y ago
        I'm sure there's lots of legal wrangling involved.
dominik 18y ago
I used Hulu to keep track of Battlestar Galatica for the early half of this past season. Originally, Hulu posted episodes the day after they aired and didn't include any commercials. However, as the end of the season approached, Hulu -- without warning or advance notice -- delayed posting episodes until 8 days after they aired. Only after folks complained did they put up a schedule of airdates. I also had the chance to watch several movies on Hulu; once again I found the service started excellent and got progressively worse. Early on, movies downloaded quickly and had no ads. Towards the end of May, however, Hulu started interrupting movies with ads in seemingly random places -- not in natural transition points but right in the middle of an actor's words. Furthermore, as they apparently hadn't secured advertising yet, these "ads" were just 15 seconds of static white text on a black screen that read: "Brought to you by Hulu's advertisers" or some such. I found these pointless since they didn't even name the advertisers or feature their logos. Disgusted with these pointless interruptions, I've since swore off Hulu. In short: They had a good thing going at the start, but have proceeded to muck it up.
vaksel 18y ago
25mm in revenues is small? I mean sure its not Google but its hardly on the same level as Joe's Corner Store, Mike's Landscaper Services and Paul's Video Store.
- SwellJoe 18y ago
  25mm in revenues is small? Yep. $12.5-25 million will only support about 100-200 employees. Maybe more, if they're not high end people (but I suspect Hulu does not have a lot of positions that don't require some sort of high end expertise--very little call for consumer sales or tech support in a business like that). 100-200 people is still a pretty small business in modern terms. Google employs 35,000 (or something like that). Microsoft, Sun, IBM, and Intel probably dwarf Googles numbers.
  - bdotdub 18y ago
    Yes, 100-200 is a small company, but do you think they even have that many? For a site that went live in March, I'd be surprised if they had anywhere close to that many employees. I don't think any of those companies would have had that many employees 4 months after going live. So 12.5-25 million? I'd say they're doing pretty well for themselves..
    - SwellJoe 18y ago
      No, I don't think that have that many...though Hulu does work with the industry rather than outside of it, so I suspect there are a lot more lawyers and MBAs on staff than you or I could possibly imagine.
  - LogicHoleFlaw 18y ago
    I've been struggling with this one myself. My current company will have grown from 50 people in January '07 to 300+ in January '09. And the larger we get, the longer it seems to take to get anything done. I'm very interested in hearing strategies for keeping a company aggressively small without having to give up the ability to chase increasing revenue.
pchristensen 18y ago
Small for the companies that run it.

12 points by fromedome 18y ago

They need to 1) includes ads into small clips (3-5 min) and 2) vary the advertising on full television episodes. Seeing the same Toyota ad seven times isn't helpful to the consumer.

bouncingsoul 18y ago
1. They do sometimes have 15 second ads on short excerpts – and I absolutely hate it. The cost just seems way too high for a 1:00 clip. (On the plus side it makes me reconsider if I'm spending my time wisely.) 2. I too don't understand why they play the same one or two ads for the entire movie. It honestly gets annoying, which seems like something you don't want your advertising to do. At this point I just mute them.
SwellJoe 18y ago
Seeing the same Toyota ad seven times isn't helpful to the consumer. But it's helpful to the marketer. It takes at least that many impressions to even register. This is actually why I'm surprised by how little money online advertising makes. It would be possible for an advertiser to buy several impressions with the same user--or a series of ads being shown to the same user. Everything I've ever read about marketing tells me this would be more effective than an ad shown to five different people only once. They need to 1) includes ads into small clips (3-5 min) I recently built an HTPC with Media Center. When I first fired it up, I browsed to the "watch TV online" thing...clicked on the first popular clip. 30 second ad. 45 second clip. Never again will I browse to that option on my HTPC. Ever. Anything less than 5 minutes with an ad is gonna piss me off. But, I do love Hulu. The quality isn't as good as I'd like for most of the shows and movies (that HTPC is hooked up to a 46" 1080p TV), and I had to hit bittorrent to catch up on Battlestar Galactica this season when I missed the first couple--they only have the last three or four episodes on Hulu and scifi.com--but I still like being able to catch up on shows at my convenience.
alaskamiller 18y ago
The ads keeps getting replayed because they run out of inventory. They had trouble filling in spots for awhile and resorted to running bumps.

coglethorpe 18y ago

How much revenue do they "need?" I know sites cost less and less to operate, and a small team of developers can do a lot.

webwright 18y ago

12-25 million in revenue is staggeringly good for their age. Private beta in Oct 07. Launch in March 08. Assuming growth (which I think they have), I'd call that a pretty amazing success.

akd 18y ago
It's a bit different when you're an NBC / News Corp joint venture. The whole issue of getting your name out there, networking, etc. is not really an issue -- the CEO makes 10 phone calls and has all his content lined up. Also the amount of free publicity was massive since NBC and News Corp together control a number of different media outlets, and other news organizations jumped on the bandwagon.
- alaskamiller 18y ago
  I have yet seen any reference to Hulu on the networks. In fact, Fox prior to this month were still telling people to go to fox.com and use the horrible media player to watch shows on demand. Having the access to that huge library of content, though, makes it pretty darn hard for other companies to play in the field.
  - j2d2 18y ago
    I'd guess they're still building out the library. Much better to make a huge splash than be another youtube.
    - alaskamiller 18y ago
      I'm sure there's lots of legal wrangling involved.

dominik 18y ago

I used Hulu to keep track of Battlestar Galatica for the early half of this past season. Originally, Hulu posted episodes the day after they aired and didn't include any commercials. However, as the end of the season approached, Hulu -- without warning or advance notice -- delayed posting episodes until 8 days after they aired. Only after folks complained did they put up a schedule of airdates. I also had the chance to watch several movies on Hulu; once again I found the service started excellent and got progressively worse. Early on, movies downloaded quickly and had no ads. Towards the end of May, however, Hulu started interrupting movies with ads in seemingly random places -- not in natural transition points but right in the middle of an actor's words. Furthermore, as they apparently hadn't secured advertising yet, these "ads" were just 15 seconds of static white text on a black screen that read: "Brought to you by Hulu's advertisers" or some such. I found these pointless since they didn't even name the advertisers or feature their logos. Disgusted with these pointless interruptions, I've since swore off Hulu. In short: They had a good thing going at the start, but have proceeded to muck it up.

vaksel 18y ago

25mm in revenues is small? I mean sure its not Google but its hardly on the same level as Joe's Corner Store, Mike's Landscaper Services and Paul's Video Store.

SwellJoe 18y ago
25mm in revenues is small? Yep. $12.5-25 million will only support about 100-200 employees. Maybe more, if they're not high end people (but I suspect Hulu does not have a lot of positions that don't require some sort of high end expertise--very little call for consumer sales or tech support in a business like that). 100-200 people is still a pretty small business in modern terms. Google employs 35,000 (or something like that). Microsoft, Sun, IBM, and Intel probably dwarf Googles numbers.
- bdotdub 18y ago
  Yes, 100-200 is a small company, but do you think they even have that many? For a site that went live in March, I'd be surprised if they had anywhere close to that many employees. I don't think any of those companies would have had that many employees 4 months after going live. So 12.5-25 million? I'd say they're doing pretty well for themselves..
  - SwellJoe 18y ago
    No, I don't think that have that many...though Hulu does work with the industry rather than outside of it, so I suspect there are a lot more lawyers and MBAs on staff than you or I could possibly imagine.
- LogicHoleFlaw 18y ago
  I've been struggling with this one myself. My current company will have grown from 50 people in January '07 to 300+ in January '09. And the larger we get, the longer it seems to take to get anything done. I'm very interested in hearing strategies for keeping a company aggressively small without having to give up the ability to chase increasing revenue.

pchristensen 18y ago

Small for the companies that run it.