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"A topic I've tackled several times here at Mashable has been the question of Hulu versus YouTube in terms of their advertising strategies. My friend Frederic Lardinois over at ReadWriteWeb brought the topic up today in reference to news from the Financial Times regarding the revenue of the two video business units.\u00A0\n\nIn the past, though, tons of bloggers have taken potshots at YouTube for not realizing the potential of the $1.65 billion investment by Google. One of the more recent times I got on this particular merry-go-round was back in June in response to Mark Cuban, who said that Hulu was in danger of roundly kicking YouTube's ass in terms of viewership and monetization. Back then, as they do now, the traffic numbers simply tell a different story.\n\nAs you can see, back in June through October of this month, Hulu has seen significant gains relative to their current traffic patterns (very likely due to the highly watched election videos and Sarah Palin\u00A0- watch for this line to drop in December). Compared to YouTube? The difference is still monstrous.\nHow is it possible, then, that the Financial Times is able to make statements like this:\nNeither company breaks out its advertising revenues but Arash Amel, analyst at Screen Digest, forecasts that in 2008 YouTube will generate about $100m in the US, compared with about $70m at Hulu. Next year both sites will generate about $180m in the US, he says. YouTube currently earns around half of its revenues in the US, while Hulu has not yet launched internationally.\nSetting aside any quibbles we may have with their estimates, for a moment, very simply put - the Hulu sales team is lightyears ahead of what's being done at Google.\nAren't Advertisers Just Scared of YouTube?\nThat's the phrase that pays when pundits and analysts come together to talk about monetization efforts on UGC video. Frederic mentioned it in his writeup. Henry Blodgett said something similar when he deigned to advise Google to \"throw in the towel\" on YouTube. The issue doesn't have anything to do with advertiser readiness to throw down with the money, and more to do with the limited avenues to do so.\nJust as a proof-of-concept on this theory, give yourself a five minute limit to figure out how to put an ad on the side-bar on a Google search result. \u00A0Even if you don't know where to start, you should get there with four minutes to spare, assuming you know how to ... you know ... type a Google query.\nNow try the same thing with YouTube.\nNot so easy, is it? \u00A0If you're lucky, on your third or fourth search query, you'll turn up this page, which YouTube dubs its online media kit. If you have the patience, you can spend about a half-hour watching Googlers tell you how awesome it is to advertise on YouTube, complete with some product manager playing with his plastic dinosaurs.\nThis is what I'm talking about. \u00A0If you actually watch these videos, you get the picture that YouTube is running advertisements on only a fraction\u00A0of those gazillions of page-views and video views. In fact, they only run ads on videos that participate in the \"Partner Program,\" a program not easy to figure out how to join, either.\nJust think of the money YouTube could make if they ran just a stupid little text-based AdSense unit on every page on YouTube. We started running through this intellectual exercise the last time this topic came up here - we determined that YouTube needed to monetize (generously) 1% of their traffic to thoroughly trounce Hulu.\nIt's easy to see here that the same minds that brought us search ads aren't working on what's at YouTube, otherwise they'd have this problem licked by now. For further proof, take a gander at your AdWords account, and try to find the button that allows you to advertise on YouTube. \u00A0I'll save you some time - it isn't there, not even next to the \"advertise on radio\" or \"advertise on TV\" links.\nHulu Doesn't Have an Easy Advertiser Form Either. How Are They Doing So Well?\nThat's because they don't need one. As Blodget notes in his write-up, Hulu gives more money back to its partners than YouTube does with theirs. \u00A0What Blodget fails to mention is that this is a pointless statistic, since Hulu is essentially a puppet entity for News Corporation and NBC Universal.\nThis means that they don't really need to rely on an in-house sales team as YouTube does, at least not throughout the year. They do the bulk of their big name, high dollar selling at what's called the \"upfronts\" every year. Millions of dollars trade hands after the May sweeps at these star-studded events, and YouTube hasn't made inroads to tap into this market.\nIf they sold at the upfronts, it isn't like it would land them the type of money Hulu's getting. \u00A0Even the most watched content on YouTube still doesn't have the international brand recognition of your average show on the WB. Simply put, the TV networks still have decades of brand recognition built up, and YouTube is technically still a toddler.\nAs Soon as Google and YouTube Start Playing to Their Strengths...\nHere's the point I'm driving at - YouTube has been doing things right in almost every category so far when it comes to growing the brand and traffic to the site.\nThey have a lumbering behemoth in terms of traffic, and it looks to me like they're trying to outlast some dinosaurs of Old Media just long enough so that some of these pesky copyright issues outmode themselves (either by these Old Media companies dying off themselves, or their grasp of New Media catching up with reality). That's frankly the only explanation I can think of behind why they'd not treat their YouTube traffic like every other type of traffic contained within the Google family.\nPlaying to their weaknesses, and by that I mean trying to compete with Hulu and other studio produced aggregators head on... it's akin to looking for the golden needles in the haystack, instead of feeding all that hay into the gold-spinning wheel they have sitting in the back."^^<http://www.w3.org/2001/XMLSchema#string>
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