Jason Kilar, former Hulu CEO, is up to something new and potentially huge. His latest venture is Vessel, an online video service that’s now open as an invite-only beta, but could be open to the public at large as early as March.

Depending on your point of view, Kilar could be trying to compete with YouTube’s dominance head on (with the goal of dethroning it), or he could be attempting to add to the online video community, aiming to fill in gaps left agape by YouTube. Perhaps it’s both.

Regardless, he’s put a lot of muscle into this so far, having recruited many from his former team at Hulu to get the service up and running. Vessel co-founder Richard Tom was formerly CTO at Hulu and ad chief Jean-Paul Colaco performed the same role at Hulu, according to AdAge. Kilar raised $75 million in funding from Benchmark, Greylock, and Amazon CEO Jeff Bezos’s personal investment fund.

Not to mention, he’s gone directly for some of YouTube’s best.  Stars like Shane Dawson, Ingrid Nielsen, Marcus Butler and Rhett & Link have all signed on with Vessel, which means their content will be live exclusively on Vessel for three days before it hits the wide open internet, reports GigaOm. Additionally, media brands like Nerdist Industries, Tastemade and Machinima are on board.

So what’s the big differentiator here, between YouTube and Vessel? Yes, it’s that exclusive 72 hour content window, but it’s mostly the subscriber element.  In order to enjoy that early access to content from you favorite YouTube star, you’ll need to pay $2.99 a month.

However, after that 72 hour period, the content will be free to land on other sites, and will likely be free of charge there. And here’s where Vessel is counting on taking advantage of what YouTube already built: loyal fan followings. The idea is that these fans will so badly want exclusive access to early content, that they’ll be willing to pay up.


As many, like Fast Company, have observed, Vessel is a blend between YouTube’s huge success as a snackable video platform — especially among young people — and Hulu’s ongoing reign as a premium video service. Where Kilar sees particular opportunity is in YouTube’s much-maligned revenue model. Vessel “capitalizes on YouTube’s perceived Achilles Heel: a revenue model for creators that gives partners 55% of the ad revenue they generate,” writes Fast Company.

Kilar will offer a better value, according to Re/Code, which wrote that “people who give him exclusive content will get paid out of a pool that represents 60 percent of Vessel’s subscription revenue, divvied up by usage. (Kilar) says they will also be able to keep 70 percent of the ad revenue associated with their clips.”

Seems like a better deal for creators, so long as the service gains enough traction to actually raise significant payout money. Like Hulu, ads will be mixed into all content, whether you’re a subscriber to Vessel or not (a selection of content — none of it early access — will be free to view on the site). Even so, users can anticipate an unobtrusive ad experience, according to Kilar, who said Vessel will depend on visual ads between videos and a preroll video ad that’s only 5 seconds long — these things in lieu of banners and skyscraper ads. Advertisers like KFC, Jaguar, Geico and Doritos have already signed on, according to GigaOm.

Our CEO Megan Cunningham is interested in Vessel’s launch and thinks it has potential to create waves in the online video industry — though she’s not without skepticism.

“Vessel represents a re-introduction of the ‘premium’ paid first window, a category that HBO created in the early days of cable,” she said. “But the premise that audiences will pay for early access to content they love has not proven itself regarding short form content — it’s a risk, as much of the target audience is Millennials who are notoriously anti-subscription.”

She continues: “But the notion of having a dual revenue stream to pay popular creators for their work is one we strongly believe in here at Magnet. I also believe there’s higher value to an advertiser when provided an engaged subscriber rather than someone having a free view. I’m excited to see how Vessel contributes to the growing number of destinations for premium content formed outside the constraints of traditional TV or Hollywood.”

Vessel will continue inviting more people to check out the platform in the coming weeks, and you can request an invite here. An Android app is also in the works, as well as further integration with smart TVs and connected devices.

Any thoughts on Vessel? Would you be willing to pay early access to video content? Let us know in the comments and connect with us on Twitter, Facebook, Google+, and LinkedIn.

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