Youtube/Hulu's New Direction?

According to businessinsider.com well known content providers may be moving towards an agreement that would see full-length movies being put on sites like Youtube/Hulu, supported by online ads. Although the article (below) suggests this move will lead to a stand-off between online video sites and more established cable companies, it may be more likely that the market will take care of itself, as has been the case for television shows (see Hulu's success).

Source

Here Comes The YouTube-Hulu-Cable Collision Course
(LINK)

UPDATE - 20 August 2009

Time Warner and Youtube have signed a formal online video distribution deal. More details below.

Source

Time Warner, YouTube ink distribution pact
(LINK)