Hulu's ad revenues to catch up to YouTube's?

It has always been in the back of many minds that having many not quite legal and not quite professional videos on your site might just affect advertising revenue.

Now Arash Amel, an analyst at Screen Digest, a company that researches digital media, is forecasting that Hulu's U.S. revenue will rival that of YouTube next year, his estimated number being $180 million. (Hulu, backed by NBC and Fox, hasn't even gotten around to launching in the rest of the world yet.)

Mr. Amal makes YouTube's earnings sound like profit of doom: "YouTube is in a very tough place right now," he told the Financial Times. "Most of that user-generated content is worthless or illegal. The next 18 months will determine whether or not it was just an expensive mistake for Google."

Google? Google? Are you scared of us yet?

(Credit: CC Lisa Williams)

Some in the advertising business have always been reticent about YouTube's rather messy atmosphere, when compared to Hulu's more focused upper-middle-class professionalism.

One client once put it to me in very blunt terms: "Why should I put my ad next to a video of some idiot screaming that Britney should be left alone?"

It will surely be interesting to see whether the mere presence of many people floating through your site on a daily basis (YouTube claims 83 million unique U.S. viewers to Hulu's 6 million) will ever be enough to attract not merely the right kinds of advertisers (yes, the ones who still have money) but also a method of advertising that actually makes online hoards pay attention.

YouTube has been frantically trying to find "new" ways to encourage advertisers, yet it seems to be reverting to some very old ways indeed.

So next year could see some considerable cheer for advertisers wanting not to be entirely dependent on Momma Google.

Oh, and good morning, Facebook. How's the growth strategy working for you?

[AppleSuxLeo]

I love Hulu. Basic Instinct uncut version was great. Sharon Stone was SO sexy.

[ballssalty]

Of course Hulu is going to surpass YouTube's ad revenue quickly. YouTube has practically no ad revenue!

[abdoismx]

The comparison made in this article (or rather the research firm) doesn't seem accurate to me. YouTube is meant to be a casual place for communities of the world to connect (in google's style). On the other hand, Hulu offers TV shows. So YouTube and Hulu are not exactly in the same market so that they can be compared. I just don't think it would mean anything to google if Hulu's advertising profits surpass theirs unless they start hosting TV shows like Hulu does.

[Mikebanks]

"User-generated content." Hmph. We were doing that 25 years ago on the consumer online services--and it worked, as I detailed in my most recent book. Quality text and software and interaction that could be had nowhere other than CompuServe, The Source, PeopleLink, Q-Link, and the like.

The problem is, there's only so much quality that you can get for free. Here's a clue for YouTube and others trying to come up with "new" ways to encourage advertisers: PAY FOR something that Web surfers actually WANT.

You can reinvient some things, like cloud computing (yes, we were dong that in 1983, too). But such opportunities are few and far between.
--Mike On the Way to the Web