Tall Tails

Tall Tails-HuluA year ago, when NBC Universal and News Corp. announced their joint venture to aggregate and stream current TV properties into a YouTube alternative, many in the industry moaned, "Uh-oh, here we go again."

Old media trying to muscle its way into a new platform with "tried and true brands" seemed to have Time Warner's Pathfinder and bud.tv written all over it. Nevertheless, Hulu cracked Nielsen's list of Top 10 video sites in April, serving 63 million streams to 2.4 million users. Though still far behind YouTube, Hulu leads the TV network hubs like ABC.com and its own parents' sites in streams and hang time.

More than traction, Hulu is growing a long and thick tail. According to Eric Feng, chief technical officer, the long beta period showed that making a deep catalog of thousands of shows available on demand paid off in usage. "We learned that over 80 percent of our content library was viewed week over week," he says. "That shows the wide distribution of viewership across the platform."

In fact, Hulu's monthly time spent viewing was a whopping 129 minutes per user. And those users represent just as long a demographic tail. According to Hitwise, 28 percent of the audience is age 55 or older, and more than a quarter belong to the 34-to-44 segment. The online audience certainly gets a bargain, with only a quarter of the advertising they would see during the same show on TV, Feng says.

The site is now experimenting with user-controlled ad formats, where the viewer can elect to see a longer ad upfront before an uninterrupted viewing or just see smaller spots interstitially during the usual breaks. "That has been a very effective advertising strategy not only for our advertisers - because they get that premium up-front spot - but users respond well to it, as well," he says. "They can opt into it. They are able to choose."
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