While this is impressive, they could have a huge audience, they just don't seem to care about capturing it. Their efforts to expand to other countries is visibly nil; the majority of networks from the US already broadcast in Canada, yet we're not allowed to get their programs through legal channels on the internet (you might get lucky with a few shows like Grey's Anatomy being available through Canadian channels websites).
They care about expanding their audience. Justin Kilar talked about this in his interview with Charlie Rose. The problem arises from the legal complexities of differing cross-border ownership rights. Hulu has to get permission from the content owner and in many cases the content owner in America will be different than the owner in France (or whatever other country). In addition, they then have to work through the regulatory frameworks there. So it's not a matter of not caring, it's a matter of overcoming the legal hurdles.
From what I recall, Kilar's intention is to first try to expand into China. An admirable goal.
The problem arises from the legal complexities of differing cross-border ownership rights
That doesn't sound right - Hulu's owners employ the best lawyers and lobbyists on the planet. These institutions don't get stopped by "oh, the copyright laws abroad are so haaard" - they're the ones who created WIPO. And anyway, what is the difference between selling rights for a TV show or a Hulu show? It certainly seems a lot less complex than the taxes McDonalds pays on exporting "know-how" when it opens franchises in France.
I suspect foreign rights have already been sold under some long-term contracts and the studios are waiting for them to expire rather than renegotiate them in the middle.
Cross-border ownership rights are enormously complex; international copyright laws make tax laws look simple, and that doesn't even take into account the differences in copyright laws between countries.
You hear about the conflict over the Watchmen IP rights, or Superman, or Terminator? Those all took place entirely within one country. Now try figuring out the rights for hundreds of shows, with hundreds of different writers and producers (including dozens of each for a single show), with rights spread out over multiple holders across multiple continents and countries with different IP and contract laws.
Difference between a TV show and a Hulu show: first and foremost, Hulu is available everywhere; a TV signal (however transmitted) is not. Hulu is on-demand. TV is not. Hulu requires a conscious effort by the viewer to select what to watch. TV is entirely passive, except for turning it on (and even that requires significantly less effort than starting up a computer). Hulu streams are individualized to each viewer; TV broadcasts are indiscriminate. There are more differences, but those are the big ones.