Hulu Has Fewer Eyeballs, More Room for Advertisers
by Peter Kafka
Posted on December 16, 2008 at 4:48 AM PT
We’ve already noted that Hulu’s audience seems to have tailed off. Now it seems as if its advertisers are less interested in the site, too.
In a roundup story about the state of online advertising, The Wall Street Journal notes that the video Web site says revenue is still increasing. But Hulu, owned by GE’s (GE) NBC and Fox, owned by News Corp. (NWS) (which also owns this Web site), no longer claims to be “sold out”:
Hulu…says its overall revenue is growing month to month, and that revenue per minute of video watched grew in November from October. But while advertising on the site was sold out as recently as August, it is no longer.
‘Clearly the environment today is different than it was four months ago,’ says Hulu Chief Executive Jason Kilar, adding that the venture ‘will be ahead of plan for 2008.’”
Hulu’s previous claims about being “sold out” were always a bit head-scratching for people who used the site with any frequency: Sure, you were likely to see an ad (good bet: It was from Esurance) when you first loaded up a “Saturday Night Live” clip. But the more video you watched, the more likely you were to see freebie public service announcements from the Ad Council.
It’s hard to get worked up over this development. That’s partly because the notion of any Web site being “sold out” is a bit of a theoretical construct: The more people who visit the site, the more inventory it has to sell to advertisers–if the publisher wants to sell it.
And it’s also hard to read much into this because the Web video ad market has become a total crap shoot. Hulu says sales for the fourth quarter are still up over last year, and online execs at CBS (CBS) and at Disney’s (DIS) ABC say the same thing. But they have little idea what to expect for next year. Which makes them just like everyone else selling online ads.
Meanwhile, here’s a Hulu clip featuring the final “Saturday Night Live” appearance from the excellent Amy Poehler, who left the cast after last weekend’s show. She’s getting ready to launch her own NBC sitcom:
Comments
Can’t see the clip as I’m not in the US. Maybe that’s one reason they have so few people watching?
Posted by Owen Cutajar at December 16th, 2008 at 5:21 amNo, there are a bunch of people watching. They have a well-documented problem showing their stuff in other countries. In part that’s a licensing issue, and it’s in part because showing its even harder to sell ads against an international audience.
Posted by Peter Kafka at December 16th, 2008 at 5:56 amI am dubious that frequency capping is actually employed, particularly for emerging companies or in more involved ad integrations. For most sites, deals larger than $100K per 2 -3 months almost invariably create very real sell-outs. Even fewer sites are capable of running 2 – 3 such high impact campaigns simultaneously. Since the big branded campaigns still require all sorts of salespeople involvement, its close to impossible to scale a brand advertising model.
Posted by Jonathan Marcus at December 18th, 2008 at 8:40 pm