From how I see it, 2009 will be the year of video advertising, but it may not be YouTube’s year at all.
Recent reports have related about the rise of Hulu, which is significant for two reasons. One is that Hulu seems to be getting better reception nowadays and is said to be getting people off YouTube into its own domain.
They are advertising in YouTube. In fact, YouTube is where most users get introduced to Hulu. They upload short clips of films, TV series and other content on their YouTube channels, and then tell people to go to their site for the full versions.
Two, Hulu seems to have succeeded where YouTube failed: monetizing its videos. This is important because, as big as it is, YouTube have not earned too much from its videos, even when advertising overlord Google assumed its management. Hulu has done what YouTube did not bother looking at: advertising in the videos.
And it is not something that YouTube can easily replicate. Hulu has, from the start, secured the right to advertise in ALL the videos posted on the site. YouTube, on the other hand, is a hosting service that is not supposed to know what its users are posting on its site, much less be licensed to advertise with these videos. Much like how your hosting service is not supposed to see your database of customers, or what is on your Web site. Conversely, your hosting service is not allowed to proofread and edit the contents of your Web pages.
While YouTube will remain as the place to go to when you need a viral video fix, or went you want to watch user-generated videos, even when you need to upload your own videos, Hulu makes money better, and will become the go-to place for paid content like TV shows and movies. In this case, YouTube may not be the only victim, but also companies like NetFlix, that offer paid streaming of movies.
I concede that it will never be a question of Hulu toppling YouTube or vice versa: each serves a different purpose and caters to different needs. At the end of the day, YouTube will still find it more difficult to turn its site visitors into paying customers. Hulu, it seems, is inherently set to make money. In the world of business, it is not the number of people who goes into your store every day that makes a difference; it’s the number of people who buys. With the Hulu showing the way on how to monetize videos, video advertising will soon make sense.