Published on 11/13/2008
By Ravit Lichtenberg (blog)
Jason Kilar speaks modestly about Hulu’s growth and its dedication to creating a “brain-spray” of experience for its users, advertisers, and content providers. Hulu was named #1 product for 2008 by PC World Magazine; Time magazine recently wrote it is among the top 5 inventions to watch (it’s the fourth).
There are 12.6 billion number of video streams in the US according to ComScore, opens Kilar. A lot of users are responding to video on the internet: both user generated and premium, both long form and shot form. Hulu was founded to take a look at that environment and innovate on behalf of users. Kilar compares the Hulu model to Starbuck’s. Starbucks understood the coffee business is an impulse business. If you can make it ubiquitous, says Kilar, you make it easy to consume. If you make it easy to consume, people will consume more of it.
Hulu’s mission statement is “to help people find and enjoy the world’s premium content when where and how they want to.” Hulu’s Rallying Cry: We want to deliver content, a service, that users, advertisers, and content owners unabashedly love. “We’re just about that,” says Kilar, “and about delivering brain-spray awesome quality.”
Kilar speaks of Hulu as an obsession. It’s about obsessing (over the user experience) just like Disney obsesses about the experience in its theme parks. “We argue about the font size and the placement of logo.”
When the topic gets to advertising, Kilar makes Hulu seem extremely appealing. From what I gather, Hulu is experimenting with various advertising models including 30 second spots, presenting users with ad options to choose from and rate a la Dig style (did you like that ad?). I ask Jason what users really say: Does a user start with--yes, please give me more ads? Do people really want to watch something other than the content they chose? Jason says Hulu constantly speaks to users—and users generally understand that there’s a tradeoff for watching content for free. The baseline Hulu is speaking to, is the TV model where users pay for TV and are forced to watch 4-10 minutes of commercials. Compared to that model, Hulu provides a much better experience—some might say it seems “more free.”
Online media streaming providers need to pay for their business somehow. But their success is going to depend on how they engage with their users. As more content moves online (and across platforms), companies will have to create and adhere to contracts with their users. Length of ad, placement, relevance, and quality are all going to play an important role. Conversation, engagement, and creativity will become a differentiating factor.