ABC / Disney is joining Hulu.com, the third most popular video site on the Web, behind YouTube and Fox Interactive/My Space sites.

Now, three of the four big broadcast networks own stakes in Hulu. CBS has rejected all offers to join Hulu; they say they want to maintain control over the distribution of its shows online. (CBS distributes its shows on 300 video sites, including Joost, MSN and AOL.)

The deal is a blow to YouTube.

Hulu, which is 18 months old, displays free, high-quality versions of television shows and movies, supported by advertising. Advertisers consider that the experience on Hulu is superior than in YuTube.

ABC / Disney will take a 28 percent stake in Hulu, and will give Hulu around $25 million in marketing credit during broadcast shows.

ABC’s most shows will continue to be available on ABC.com. By distributing them on Hulu (and its partner sites, like MySpace and AOL.com), the goal is reaching Hulu’s much-larger audience of 42 million visitors a month.


Less Video and Photo Quality in Developing Countries

In the world there are 1.6 billion people with Internet access, but fewer than half of them have incomes high enough to interest major advertisers. In Asia, Middle East, and Latin America bandwidth is expensive and ad rates are low. Therefore, Internet companies who really want to make money “should shut off all those countries,” Michaello Volpi, CEO of Joost said in the New YTork Times.

Few companies have taken that drastic step, but many are exploring other ways to increase revenue or cut cost in developing countries.

My Space, with 45 percent of users overseas, is testing a feature for countries with slower Internet connections called Profile Lite. YouTube and Facebook are exploring the idea of decreasing the video and photo resolution, in an effort to reduce losses.