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Why the NFL Can Play Ball with Hulu, While Comedy Central Can't

By Catharine Taylor

Updated on: March 9, 2010 / 3:59 PM EST / MoneyWatch

The news today that Hulu has just struck a content deal with the National Football League may leave some wondering what exactly is going on with the streaming video site -- especially in light of last week's bad news: that Comedy Central was pullling its content, including Hulu favorites "The Daily Show" and "The Colbert Report" off the service.

If you're a content producer should you or shouldn't you Hulu?

Here's what's going on: Even as the debate over how and whether consumers should pay for content continues, not all content is created equal -- particularly when it comes to making money online.

The Hulu deal calls for the NFL, via an NFL Network channel, to start uploading content this week, with 400 hours going up initially, and a total of 1,000 hours going live by the time next season starts. But from the standpoint of whether the NFL will make money off of this, here's the key point: the content is mainly highlights from already-played games, packaged and re-packaged in a number of different ways. It's a dynamic library of the NFL's greatest hits, almost none of which will eat in the NFL's existing way of making money off video -- by getting a handsome cut of the ads sold against its live games on ESPN, NBC, Fox and CBS. Viewers will come to this micro-site because they want to see plays again or get more content, not because it any way replaces the experience of watching a game live.

The NFL has apparently had similar content available on its site for some time; the Hulu deal adds distribution, which should increase viewership and also heighten interest in the league. It also will ramp up what appears to be the NFL's anemic attempts to sell ads against content at its own video site. A quick look at some of the video highlighted there today showed that it isn't doing much. Hulu, which sells ads not by individual programming but by packaging huge demographic buckets for advertisers across the entire site, shoudl be able to take care of that.

Contrast what will probably be the NFL's positive experience with Hulu with what Comedy Central confronted last week when it pulled its content off the site. The cable channel was offering consumers the exact same content in a much more consumer-friendly way, in part because viewers could watch it with minimal commercials. In the monetization game, there's no contest.

Previous coverage of Hulu at BNET Media: