Beyond the DVR- Hulu is the new way to watch TV.

"To me, this is the way media always should have been," says Hulu CEO Jason Kilar.
Illustration: Todd Alan Breland

What's a hulu? In August 2007, this question ricocheted through the blogosphere to a chorus of derisive laughter. Fox and NBC were going to make the Internet safe for television! They were building a "YouTube killer"! And they were calling it Hulu! It was almost too perfect—an absurdist topper to the idea that two major broadcast networks could devise an Internet video service people would actually use. The name was even more delicious than the venture's placeholder moniker, NewCo., which the online world had changed to Clown Co. And now Hulu? It means "snoring" in Chinese, one blogger declared. "'Cease' and 'desist' in Swahili," Michael Arrington reported on TechCrunch. "Perhaps they should have just stuck with Clown Co.," he added.

Jason Kilar read these posts and winced. A 36-year-old ex-Amazon.com executive newly relocated to Los Angeles, Kilar had followed—even admired—many of these bloggers for years. Now he was Hulu's CEO, and their ridicule wasn't so funny.

What's a Hulu? Kilar had gotten the same question from Jeff Zucker, chief of NBC Universal, and Peter Chernin, president of News Corporation, Fox's corporate parent. In English it means nothing. In Mandarin, when pronounced another way, it means not snoring but "bottle gourd," which, in an old Chinese proverb, stands for a "holder of precious things." If you say so, they responded.

Even Kilar was starting to wonder whether he could make this thing work. Along with the new name, he had just announced that Hulu, which he had been running for only seven weeks, would launch in beta in two months—much later than expected but far too soon for a team that had barely gotten started. He was heading an operation of 20 people holed up in an office suite in West LA. To meet the deadline, he had turned the place into a bunker: Newspapers covered every window. People were sleeping on air mattresses on the floor. Half-eaten pizzas littered the empty cubicles. Fruit flies were the only visitors.

But Kilar would make it work. He and his crew would emerge from their dismal cave with the sleekest, easiest-to-use, most professional video site on the Internet. Not only would it deliver shows and movies from Fox and NBC Universal, it would take you to programs from every other major network and studio. Full-length episodes. Entire seasons. For free. Within months of that late-August announcement, Hulu would be among the top 10 US video sites in number of clips streamed. Om Malik, one of the bloggers who had ridiculed it from the start, would pronounce it "brilliant." TechCrunch readers would vote it best video startup of 2007. "Game Over. Hulu Wins," Arrington would declare in a conciliatory post. How did that happen?

Find out here: