Hulu Ads OK Say Consumers

By Richard Menta 7/24/08

When it comes to digital content, monetizing the Internet has been one of the greater challenges for those who create content. Content suppliers want to generate revenue for their wares, but shrinking consumers dollars are already pulled in every direction. That's why free advertising-supported content is still appealing to viewers. That's good news for video sites like Hulu.

The music and movie industries - two industries that normally charge consumers for their content - continue to struggle with this, but television content, which has always been advertising supported, has begun to bloom online. Ad generated revenue is a business model that TV execs are long comfortable with and as the TV industry shifts their focus from the iTunes pay-per-episode system to the ad-supported one sported by Hulu, things have begun to improve.

Take South Park as an example. In a joint venture launched last March between Comedy Central and the show's producers every episode of that program was posted online for free on the site, supported by ads. As shows, traffic to the site exploded ten-fold with the release of the episodes, thrusting the site near the top 1000 sites on the Net.

Recent research by Ipsos MediaCT validates that ad-supported content is a viable mechanism for online content delivery. Ipsos found that three out of four digital video consumers say they would find it “reasonable” for advertising to be included in free TV and movie fare. However, this applies to professionally developed content only. Half of those polled said it mould not be reasonable to utilize ads in amature content.

"Consumer reaction to this concept does vary by type of digital video content", said Ipsos Director Adam Wright. “As might be expected, digital video consumers generally find it more acceptable to have advertising included within longer, professionally produced video offerings such as full-length movies or TV shows".




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