Sometimes Goliath wins

March 13 0 Comments Category: Business

Hulu was never an edgy start-up built on love and drive. The comparison to YouTube in the case study points this up.

Despite unsexy beginnings to build something “out of frustration that other people were using our video online and creating a business”, Hulu made good. Riding the fence between edgy and market-conscious, they captured users quickly with their fast viewer and professionally produced videos. And of course, business savvy.

– “Cost should act as a floor for pricing.”
YouTube initially spent more on bandwidth than it made in revenue. The startup disdained banner ads and “pre-rolls”– but Google reconsidered upon viewing the financial situation. Hulu went from free to subscriptions last year and now, to limited free episodes and a free week trial. Pivot towards the money.

– “One trend in advertising is the movement to more precisely targeted media vehicles.”
The Note refers to retail promotions, but Hulu’s innovations in targeted advertising are more noteworthy. If an ad’s being forced on you, offering a choice makes you slightly complicit. Not to mention pulls out more customer information. Evil genius.

– “Culture, like technology, can shift and bring surprise unless carefully monitored.”
Both culture and technology helped to solidify Hulu’s chance for success. Americans log 300 minutes a day on TV and 10 minutes for online video. But trends are on Hulu’s side: more and more households have broadband, larger and clearer TVs come outfitted with internet capability, and people pay for premium TV content. A perfect storm.

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