NEW YORK (AdAge.com) -- Taking a stake in Hulu represents a big change in approach for Walt Disney Co., which was first among the networks to distribute on the web but kept content tightly controlled on ABC.com and the websites of ABC's broadcast affiliates.
The deal brings a valuable trove of content to Hulu, but the potentially bigger news is that the original joint-venture partners, NBC Universal and News Corp., reportedly extended the exclusivity of their content, giving Hulu two years to exclusively distribute all three networks. Also notable in the deal: Hulu gets the likes of Disney CEO Bob Iger, ABC/Disney TV Group President Anne Sweeney and Exec VP-Corporate Strategy Kevin Mayer on its board.
Ad Age talked to Hulu CEO Jason Kilar about how the deal changes the game for Hulu, whether a deal with CBS is possible and if there's a way for Hulu to work with YouTube.
Ad Age: Hulu already had plenty of TV content from 150 partners. Is adding ABC really that big a deal?
Mr. Kilar: In many ways this is day one of what we hope will be a long journey for the company. It's very important, and I would say the same for the original-content relationships we've had and the ones we've added. Every new body of content makes the service that much more valuable.
Ad Age: Is the ABC deal any different from the NBC and Fox deals in the way ad-revenue splits are structured and as far as their stake in the company?
Mr. Kilar: The relationship with Disney largely mirrors the relationship with News Corp. and NBCU. In terms of ad revenue, NBCU, Fox and Walt Disney are materially the same. There was a lot of discussion about what each of the shareholders brought to Hulu. There are a lot of things Disney brings that is extremely valuable in terms of culture and talent.
Ad Age: How is it determined which ABC or Disney content makes it to Hulu?
Mr. Kilar: What you see on ABC.com when content starts flowing will be what you will see on Hulu. There are also library titles and feature films as well. Thus far, ABC.com has been focused on current programming. If they stay with that, you might see library content on Hulu that is not on ABC.com.
Ad Age: Since ABC is contributing promotional resources, does that mean we're going to see Hulu ads on ABC? With Alec Baldwin?
Mr. Kilar: We've been careful not to comment on all the specifics of the arrangement. The relationship allows us to continue that sort of ad campaigns we've done with Alec Baldwin and Seth McFarland.
Ad Age: Do you think Hulu can resolve its differences with CBS and either bring it on as a partner or at least resolve the ongoing dispute with TV.com?
Mr. Kilar: We've had conversations with both CBS and the team from the start, and I have a lot of respect for the organizations there and the decisions made along the way. We'd love to present their programming to our 42 million monthly users. We've continued to have conversations. The good news is they're getting to know us. I believe we would provide a lot of value for them as content owners and for their shareholders. We'd love to have them. I can't comment on TV.com because it has become a legal matter.
Ad Age: Could you see Hulu getting Pixar films at any point?
Mr. Kilar: No. Their approach to Pixar has been very DVD-focused. As far as films on Hulu, just realize we are still working that out.
Ad Age: How soon will ABC content be available on Hulu?
Mr. Kilar: We don't know; we are certainly working hard. It is subject to a couple of things. We need to ingest the content in a high-quality manner. Different things we need to do in terms of filing paper work and making sure everything is buttoned up.
Ad Age: Now that you've locked up a good portion of Hollywood, could you see distributing through YouTube, given its push toward studio content?
Mr. Kilar: I would have to think through that a lot more. We have distributed Hulu in a lot of different neighborhoods on the web. It's a constantly evolving conversation at Hulu. We don't rule anything out.