Analyst Survey: Why Cable Operators Should Fear Hulu, Not YouTube

This story was written by Rory Maher.
With so many video aggregators, user-generated video sites and P2P file-sharing options, people can watch TV on the web in any number of wayslegal and illegal. But those vast options also make it difficult to track viewing habitsand yet those patterns are critical to the future of broadcast and cable TV. In a report released this morning, Bernstein analyst Jeffrey Lindsay, who has been surveying hundreds of consumers about their internet TV viewing habits, says traditional broadcasters should be fearing Hulu not user-generated sites like YouTube.  Here is how he gets there:

The majority of respondents said they would be willing to pay for professional contentas much as $1 for a TV show and $5 for a movie. But most would not pay for user-generated content. In fact. 71 percent of respondents don't use P2P services where pirated content is shared among users, while only 10 percent said they use them on a regular basis. 
Seventy-four percent of respondents said they watch internet TV on their computer monitors rather than connecting their PCs to the TV, supporting the argument, according to Lindsay, that internet TV viewing is adding to TV viewing not cannibalizing it.
Over half the respondents said they watch TV or movies over an internet connection, split fairly evenly between men and women.
People tend to multitask online, so they watch shorter clips than on their TV- a 30-minute TV show or less in most cases.

More after the jump

Lindsay uses this and other data to conclude that Hulu is more of a threat to cable operators than user-generated sites like YouTube, primarily because the former has locked up most of the professional TV content, has a better proposition for advertisers, and has established itself as a viable alternative for TV watching among consumers. He says, "a new term is already entering the internet lexicon, "Hulu households.". In contrast, we have yet to come across the term "YouTube households." Of course, it's early days yet.

By Rory Maher