The Hubbub Over Hulu

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Some viewers will choose to watch its content on Hulu, where they can also watch shows from competing networks, and some will opt to watch on NBC.com. The point is, they'll be watching. "At the end of the day, we believe premium professional content wins," says George Kliavkoff, NBC Universal's Chief Digital Officer. "We believe there is power in aggregating that content, and we believe in ubiquitous distribution."

Still, whether the Hulu site will really draw in audiences depends largely on what it has to offer, says Paul Verna, senior analyst at research firm eMarketer. If it has a trove of easily accessible content that people want, along with, perhaps, some of the social features that people like so much on YouTube, it will grab an audience, says Verna. If it doesn't, people will just stay with what's familiar. "I think people do eventually reach a point where they just want to go to the sites they are familiar with," says Verna.

Blinkx Aims for "Ubiquitous Distribution"

So far, it seems that Hulu's offering won't have content from CBS and other major networks. That could change if Hulu gets a huge audience. Right now, however, CBS and others are focusing on distributing their content as widely as possible to the places where people are already watching. "CBS's strategy is to pursue open, multi-partner, nonexclusive relationships with established video destinations, widgets, and application vendor companies, as well as regular syndicators," says Quincy Smith, president of CBS Interactive. In short, says Smith, the company wants to "take it to where the eyeballs are."

That's on the social networks. Networks such as CBS and Fox see the potential to distribute their content, via shareable "widget" video players, on those sites. Hulu also plans to distribute its content, via a player, on all manner of sites.

Part of the wide distribution philosophy comes from the marketing value of having television shows near one another, instead of on unique silos around the Web. The wisdom is that, if a person is already watching—say, Fox's Simpsons—online they can easily be convinced to tune into Viacom's The Daily Show or NBC's comedy 30 Rock. That's why deals are being struck left and right to bring content together.

On Aug. 30, video search engine blinkx announced a partnership with Michael Eisner's new media studio Vuguru to bring the Web drama Prom Queen to its site. Already, blinkx brings together clips of premium content from around the Web via its video search engine, before directing users to where they can watch the full shows. "Ubiquitous distribution is primarily about marketing and building an audience around a product," says blinkx founder Suranga Chandratillake.

The point of spreading content around is that it also spreads around the ads, generating more revenue from additional viewers. Of course, that revenue is only extra if those viewers are not existing fans who would otherwise visit the network site but instead watch on a site where the ad sales must be split between a variety of partners. Hulu's owners will welcome the viewership however it comes. Now they need to ensure there's plenty to watch once there.

Holahan is a writer for BusinessWeek.com in New York.