Online video site Hulu trumpeted its ascension to the media big time a few months back with a dash of sardonic humor. In its debut TV commercial, in which Alec Baldwin mocks the audience's addiction to the very shows he creates as a fictional network executive, the site calls itself "an evil plot to destroy the world."
The joke is uneasily close to the truth for some in the television business.
Once dismissed as "Clown Co." by Silicon Valley critics who scoffed at the notion that old media giants could ever harness the Internet, the website with a name that sounds like a Hawaiian dance has quickly upset the status quo. Hulu's traction with users has entrenched entertainment companies worried that the video site's runaway success could undercut the financial underpinnings of the industry.
Those companies are fighting back, and the result could mean no more free passes for many signature cable programs that appear on Hulu.
NBC Universal and News Corp. publicly launched Hulu a little more than a year ago as a gamble on television's digital future. The website allows viewers to watch thousands of episodes of TV shows for free, from current hits like "Family Guy" and "The Office" to old favorites like "WKRP in Cincinnati" and "I Dream of Jeannie." Hulu's simple design, expansive catalog and no cover charge have elevated it to one of the most popular websites for watching video.
With 42 million viewers in March -- an audience nearly twice the size of TV's most popular show, Fox's "American Idol" -- Hulu whizzed past Yahoo and Microsoft's MSN, and is now nipping at the heels of Google's YouTube.
"Hulu has certainly exceeded all of our expectations," said Jean-Briac Perrette, NBC Universal's president of digital distribution. "We've come a long way from Clown Co."
Late last month, Walt Disney Co. overcame its initial skepticism and signed on as an equity owner of Hulu, which has nearly 150 content partners. That gives the video site even more star power with the addition of ABC's "Desperate Housewives" and "Lost," and cable hits such as ABC Family's "The Secret Life of the American Teenager" and Disney Channel's "Wizards of Waverly Place."
"Our feeling is that -- and some of this is instinct, by the way -- media consumption online is growing and will continue to grow," Disney Chief Executive Robert A. Iger said in a call last week with analysts who grilled him about Hulu. "It is really important for us to establish ourselves there."
