Sure, one can quibble that they didn't act like a startup or that people didn't want to download a player and wanted to use their browser, but really it just didn't get content.
Hulu, while not taking anything away from their impressive execution and reliability, owes most of its success to Fox, NBC and others putting loads of content on it.
Ultimately this was the difference between legit Napster and iTunes Music Store. Jobs made the negotiations, got big media to feel comfortable and got the damned content.
That's from Hulu's media info page. I think it boils down to: the networks trust themselves with their content. They aren't going to trust an outside company founded by people who made their name of pirated content (the Joost founders are the Kazaa people). Frankly, why give someone else the profits when you can create your own content distribution system? Hulu gives them both the control and the revenues.
Note: I'm not making a moral judgement on pirated content, merely explaining a possible thought process of the networks.