Youtube paying for content, radio and the Viacom Lawsuit…the net result

A few days ago Youtube said it was creating a program that would pay content providers for their content. Thats obviously great news for content providers, regardless of platform. It helps set a market for content not only for internet video, but it provides a barometer for content value relative to other mediums.

There obviously will be a lot of money available in aggregate for content providers, it will be interesting to see how much individual creators make, not only for their most popular works, which will be trumpeted in the media, but for their follow up works. What percentage of participants will be the “long tailers” in the program and what will their earnings look like ?

Its not really a question. I already know how its going to play out. It will be just like the music business.
The music business has few barriers to entry. Anyone can put their music up for sale on the net. Few barriers to content creation. It costs next to nothing for low end music creation. Marketing however is another story. It costs a lot of money to create visibility, unless of course you find yourself on the front page of a Youtube category page, or its homepage. Which puts Youtube in a position of acting just like your typical big market radio station or music radio network.
.

Paying for content, which is good in so many different ways, also has a downside. Youtube immediately went from a small, but interesting community for its original content, to basically being just like Clear Channel. Responsible for programming its different “formats” with the “best” possible content that creates the greatest number of eyeballs and maximizes advertising revenue. Its big business, just like Clear Channel

Im sure community will be involved in selecting content for their “playlists” which they will feature, but the reality is that Youtube corporate will select the videos it promotes just as music is selected to play on the radio or to be featured on radio station and related websites. Ask bands and artists how they feel about the programming skills of for profit radio stations these days ? Satellite or terrestial.

How long do you think it will be before videos appear on Youtube slamming them for which content is selected to participate in the for pay program ? milliseconds ? And how long after that will it be before those who do provide content complain that they aren’t getting the same level of promotion as others and that Youtube has gone corporate ? Instantaneously ?

But that won’t even be the most interesting issue to rear its head. As we all know, Youtube doesn’t stream its videos, it uses progressive download as its method of delivery (presumably because its saves bandwidth costs and speeds up followup viewing). Which means it delivers a copy of every video to every viewer. As mashable.com reported recented, it knows of 23 ways for end users to retain an easily usable copy of that video. How long will it be until we see content that is on Youtube expressly to earn a living for its creator posted to other video hosting sites ? (with pre roll ads , if any, edited out). You just know that the minute someone starts to make real money, that video will be on Veoh, YahooVideo ,AOL Video, Daily motion and every Tom,Dick and Harry video hosting site across the world. If Youtube goes the way of pre roll advertising , Youtube’s best videos , without the ads will pop up on hosting sites and even in Google results and ads within minutes of their posting on Youtube..

Which leads to the question of who is going to do something about it ? Who is going to take the responsibility of protecting that content that Youtube is paying for ?

Will Youtube just tell the content creators to ignore the videos on those other sites because its great promotion ? That more people will see the video, so what do you care ? So what if you are losing a few dollars, its the internet fool, thats the way it works ?

Or will Youtube tell the content creators they are responsible for monitoring all those sites and sending take down notices ? Will Youtube explain to the content creators it has just partnered with that its conceivable that the same video can be uploaded many times, a day, and even though you have a day job, you need to monitor those sites and pay for the attorney costs and filing costs of the DMCA Takedown Notices. Its your problem if those fees are more than we pay you ?

Or will Youtube add DRM ? The net would love that.

Or maybe Youtube will do the monitoring itself and will find itself playing Viacom and sending take down notices to the many websites hosting videos ? That would be interesting. Even more interesting would be if Youtube charged back the legal costs to the content providers and whether they would make the 99pct of partners for whom the legal costs exceed their payment from Youtube pay the difference and turn it into a profit center.

But wait, there is more ! What will Google Video do when people start uploading the videos that are getting a share of revenue up onto Google Video ? Will they “pre enroll” all Youtube partner videos into their filter program to prevent it from being available , or just let them be uploaded , thereby effectively ending the seperation of Google Video and Youtube.

48 thoughts on “Youtube paying for content, radio and the Viacom Lawsuit…the net result

  1. Hi Mark,

    Although we have never met, I have followed your career rather closely for the past ten years. Yep, Imageline was directly involved in the original \”.com\” boom of the late 90\’s as well … only from a totally different perspective than most of you guys with more brains (and more money).

    My companies (Imageline and its predecessor company, MGI) pioneered the development of vector-based electronic graphic arts content (clip art illustrations, animations, templates) for the PC platform in the early and mid 80\’s. We employeed some of the finest digtial artists and designers in the world. And our quality was recognized by virtually everyone. We signed licensing agreements with all of the major players of that time – Adobe, IBM, Apple/Claris, Wordperfect, Lotus, Borland, Aldus, Xerox/Ventura, Broderbund, Computer Associates, Parsons Technology, Softkey, Microsoft and others.

    Our best year was 1997.

    Things changed in the second half of 1997 (almost 10 years ago today!). New Internet companies, such as Xoom.com, InfoSpace, Go2Net, ZDNet, AOL, SimpleNet, Jumbo!, Concentric, Zedcor/ArtToday, Prodigy, Lycos, CompuServe and others (and an equal number of start-up companies internationally) began to give away software/content in exchange for \”eyeballs\”. Advertising would pay the freight. The new \”Net visionaries\” (as they liked to call themselves) discovered that \”images\” represented one of the categories of \”electronic content\” that everyone could use. Pictures were the world\’s common denominator (no translation necessary), and they required NO customer support resources.

    So what happened? Before you could blink an eye, Xoom.com and others started to proclaim that they owned \”the largest library of priorietary clip art images in the world\”. Trouble is, Mark, almost all of the digital art was pirated (sexy word for \”stolen\”).

    We battled NBCi (who acquired Xoom.com in late 1999) and others in court for over five years! The federal judges didn\’t have a clue what had hit them … especially here in Virginia! They made MAJOR mistakes. Many of them couldn\’t even spell DCMA, let alone interpret it. We took the case to the Supreme Court in 2003, but were rejected.

    We ran out of money and were forced to settle … what a shame!

    Your Google/YouTube buddies weren\’t the first to come up with this novel idea. Steal other people\’s content, make your fortune, and then get out of the way before the antiquated laws, and those who try to enforce them (both civil and criminal), can catch you. I wrote an interesting article (more like a White Paper, actually) while still with the SPA/SIIA back in mid-2000 titled the \”The Pirates Web\”. It forecast what we have today. Total chaos, in my opinion.

    So what\’s my point? I have really enjoyed your perspective on the situation with Google, Viacom, YouTube and others. I think you are one of the few who has it nailed. Wait a second, let me take that back. You are one of the few who has it nailed AND also has the guts to express your opinion publicly. I am VERY disappointed with today\’s corps of so-called independent journalists. Same thing happened in the late 90\’s. So many of their parent companies were trying to cash in on the Internet 1.0 gold rush that controversial opinions almost completely disappeared. I know. I was following it very closely at the time. Still am.

    Here\’s the danger. The backbone and origin of most of the new original ideas and entrepreneurial spirit (and employment, as well) of this country lies with the innovation of creative people who are willing to stand up for what they believe in, take a chance, work hard, and be fairly compensated if their instincts (or talents) are right.

    Digital piracy removes the final part of this delicately balanced equation. And you can\’t get the toothpaste back in the tube.

    Imageline is preparing yet another battle in our ten-year crusade to stop piracy of electronic graphic arts content over the Internet. Our industry (illustrators, artists, designers, animators, cartoonists) is poorly organized (unlike the music, photography, and movie industries) so we (Imageline) have had to form our own \”lobby\”.

    We need some \”mavericks\” to help. Are you interested? You can reach me at gpaine3@yahoo.com.

    Keep up the good work!

    George

    Comment by George Riddick -

  2. At what point does the good outweigh the bad, Mark? How much content of value must be created by independent citizens to outweigh your perceived inconvenience of the DMCA takedown methods? Youtube is an extremely important outlet of protected expression, for example this discussion of math in Washington state: http://www.youtube.com/watch?v=Tr1qee-bTZI&mode=related&search=

    Why do you have such a problem with enabled users? Is it possible that the real problem is not concern over lost profits from your own property but lost profits resulting in the creation of a model that can survive WITHOUT your property? If I were to post an advertisement on Youtube, Youtube pays for the outgoing bandwidth each time that ad is viewed!! Youtube provides a service, and most certainly one that costs them money. They are not getting a free ride, and that assertion is ludicrous.

    Will it ever be possible for someone of status in the media machine to give a crap about independent artistry, or is everyone\’s cynicism and attribution of greed correct?

    Comment by Thinkfaster -

  3. believe we will see a shift in the practice and application of copy right law in the coming little while, and a new evolution in the business of artist representation and interpretation.
    anyway,Thank u.

    Comment by wow power leveling -

  4. Mark,

    You have obviously hit on the problem, but have not come up with a solution. The problem is that over the long term Youtube doesn\’t have a way to monetize content and stay popular. As soon YouTube makes things to onerous on its viewers, by adding DRM or advertising, they will switch.

    But what is the solution? Pay for creation, let consumers distribute for free. http://www.strayform.com lets artists fund the creation of new digital media files by their fans and releases these files under Creative Commons licenses so they can be distributed for free.

    Creative Producers want to get noticed and they want their material to get out there. Consumers have shown that they love sharing and spreading these works. \”Piracy\” is a zero-cost distribution and advertising system. It is true that the majority of people would be leechers, but that is true of everything on the internet. But all the true fans would get behind a proposal to create something new if they knew that it was up to them to make it happen.

    Don\’t you think that if you said it is going to cost $100,000 to broadcast the next Mavs games that all those who were truly interested would band together and do whatever it took to make it happen?

    Comment by Brandt Cannici -

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    Comment by vidFan -

  6. YouTube has made BILLIONS in advertising revenue, and they should share it with the people who post the videos! HERE\’S A SITE THAT DOES… http://www.flownetworkproductions/cashforvideos.htm Same as YouTube except they pay the people who post the videos. That only seems fair! This is the kind of site that will take a big bite out of YouTube. Someday soon the big corporations are going to learn that \”the more you share, the more you get.\” Unfortunately, they\’ll probably have to learn it the hard way.

    Comment by BJ -

  7. I am extremely interested in the coming Internet paradigm shift – and I\’ll let you know when I accomplish it.

    Now, as far as Donald Trump is concerned, it\’s a familiar component of the elitist milieu: material compensation. In the case of the average middle-aged money bags one could expect that he would compensate for a lack of, ahem, size with a big shiny sports car. In Donald\’s case he must endeavor to compensate for a lack of likability. When all is said and done the real proof is always in the stats. Let me say that again because it bears repeating: the proof(truth) is ALWAYS IN THE STATS.

    As a business owner and manager, I can\’t rely on opinion or personal preferences when it comes to making many decisions. I hope my judgment is sound when I DO have to make a judgment call, but if I want to hedge my bets and give myself the best chance of winning: I have to look at the stats. Who do I promote? Look at the stats. Which company do I buy? Look at the stats.

    Now notice I said LOOK at the stats. Many people will be willing to tell you what the stats are and what they mean but if the responsibility is on your shoulders then you must LOOK at the stats YOURSELF. Shareholders don\’t want to hear about mistakes made due to following the advice of second-hand hearsay. So let\’s LOOK at the stats…

    If the Hair wants to talk sports lets talk about the USFL and the New Jersey Generals. What, you\’ve never heard of the USFL? Well, that\’s not surprising. The upstart league didn\’t last very long and neither did Trump\’s team, the Generals. I think it\’s safe to assume that Mark has enjoyed vastly more success in the sports field than the Hair has.

    Point to The Mav.

    Second, let\’s consider the Hair\’s record for personal relationships. How many times has the Hair been married? Were these unions successful? Mr. Mav is still married…to his first wife. His ONLY wife. No divorce. No alimony. No child support. Just a happy family.

    Point to The Mav.

    2-0.

    I think you see where this is going.

    The hair is a media whore. It appears he has to fill the void of admiration and personal closeness that most other people enjoy with their friends and family with simple hollow media attention. And when that fails to satisfy he can always fall back on controversy. The Hair has enjoyed a major ego stroking by attacking and battling others through the media. Well, this attack may have just backfired. Because the truth is in the stats. Let\’s look at who and WHEN he attacks.

    1.Martha Stewart suffered some devastating set backs in recent years and the Hair was there.

    2. Rosie O\’Donnell has recently come out of the closet, which for a large majority of this conservative nation was a move that has devastated her popularity – and again the Hair was there.

    3. Number one Mavs fan and owner Mark Cuban\’s perennial contender, the Dallas Mavericks suffered a first round exit in the NBA playoffs – and look who\’s there: The Hair.

    You know, it\’s interesting how transparent are some people\’s motives. I would not be surprised if The Hair sits up at the local NYC hospice waiting for widowed real estate holders to kick off so he can catch the titles to their properties before they hit the ground. This is the kind of person that no one would want to be around unless you paid them. Which explains why The Hair manages to attract so many to the auditions for his TV show The Disciple, I mean The Apprentice.

    I guess a much simpler way of saying all this would be:

    Who would YOU rather have a drink and watch the game with?

    Comment by Bizfixer -

  8. Greetings,
    Thank you for sharing this posted, its well informative and knowledgeable for your visitors or for everybody here. Continue sharing your taughts for the benefits of your visitors..keep up the good!! CHEERS

    Regards,
    Happy Days DVD

    Comment by Mara Cruz -

  9. YouTube needs to add clickable links right in their videos that you can purchase. PornoTube has been jacking their success and actually monetizing the videos. It\’s going to be hard to add DRM to open source code, but I\’m sure they\’ll find a way…the doors have been open for a long time though now – so if they could get off their lazy asses and program something that works and protects the video – I\’d buy it for sure.

    Comment by Online Dating -

  10. Each Clear Channel station has a narrow pipe (as in one song at a time narrow) that broadcasts content (audio); the same exact content to each unique listener within range. Yeah, CC has issues keeping you and me both happy at the same time. YouTube has virtually an infinite width pipe to deliver the unique content that any user chooses to view at any point in time. Now agree in some ways it is easier to monetize the CC pipe (at least directly monetize it) – but YouTube doesn\’t need to get into the DJ business. YouTube has hundreds of millions of them already, including you and me.

    Comment by gzino -

  11. Consider the source.
    If you want to have some fun, buy a trump wig for your next TV appearance!

    Comment by Henry Wilf -

  12. hey dude cool blog, but all i got to say is that trump has no argument for calling you a loser or criticizing on how you own the mavs. MC get him good!

    Comment by Gabriel -

  13. Check out the Chairman David Rehr\’s comments at the NAB; then tell me why its not ok for people to play music and videos for free on the web in exchange for promoting it.

    \”Yes, people should be ALLOWED to perform! What good American is against denying rights?
    We have civil rights. We have human rights. We have property rights. We have a whole Bill of Rights in the Constitution. But performance rights? This is not about a right.

    It\’s about a wrong that the record companies are seeking to perpetuate. Radio has long played the record companies\’ music at no charge to them, the artist, or the listener… and in return the record labels and the artists have received free promotion of their products.
    Free music for free promotion.

    This arrangement has been mutually beneficial to radio, the record labels and the artists. Radio airplay continues to be the driving force behind music sales in this country. But now… the record labels want the government to impose a tax on radio stations for playing their artists\’ music.

    Imagine the brazen greed it takes for the record companies to expect us to pay them for the honor of marketing and promoting their artists\’ music. It would make much more sense for us to charge them for our promotional efforts.

    We will advocate that Congress oppose this levy on the market. If successful, it would be a government imposed performance tax. And we will fight it with everything we have.\”

    Comment by DudeAsInCool -

  14. Of course YouTube should have paid content – and yes the content will change and evolve. The big labels, industry leaders, content creators, content providers, and yes – p2p consmuers can all profit with the RIGHT distribution. John Bonaccorso, CEO of The 9thxchange, envisioned this digital marketplace five years ago. Now, with its technologically advanced structure it holds the keys to this massive digital media marketplace. Digital Media content of all kinds can be bought, sold, and traded – all with residual revenue – and all with copyrighted protection.

    Comment by Kelly Goode -

  15. Youtube users are no different than radio listeners–the only that has changed is the technology, and the fact that the congloms havent been able to come with a business model such as exists for radio. People have been able to tape things off the radio for quite some time; what makes you thing the web is any different?

    I disagree with your hypothesis on what Youtube is going to do. Youtube is going to continue to go the way the consumers want it to go–end of story. Ask Sid Sheinberg what happened when the Betamax was introduced–he will tell you: technology and consumers tastes ruled the day. They will also rule tomorrow.

    Who gives a damn what the congloms want. The world is shifting to the artists and consumers.

    Comment by DudeAsInCool -

  16. I don\’t think you can rely on YouTube as a profit generator for your content. YouTube should be one of the marketing avenues. Real profit can come from your own homepage, displayed the URL at the beginning and end of all all your content. Offering higher-quality versions will be the key to getting traffic. Also, you don\’t have to pay for all of the bandwidth either, with peer-to-peer software. YouTube + Ads on homepage + Paypal donations for the occasional generous visitor, may just make it worth it for the average content creator.

    Comment by Keith -

  17. Should be interesting to see what Yahoo and MSN do to combat Google new YouTube company.

    Comment by Margret -

  18. Another thing is this whole \”New Business Model\”

    Forget me if I\’m wrong but did we not just hear this a few years back.. It was called the Dot Com Boom.. And then came the Dot Com Bust. Did it change how businesses do things? Not really. The internet and computers became extremely popular and many people became billionaires or millionaires but the fact is many millions of people and companies crashed. The \”new business model\” was found to be unrealistic.

    I think it\’ll head down the same path, just not as bad. The youtubes and myspaces will still make their money and survive but the million other new sites and startups will probably fail.

    Advertising works great if the economy is going well. Advertising works great if you are the \”in\” thing. But just as sports players get older and people change, so does everybody else. What\’s popular now won\’t be popular tomorrow. MySpace is losing it\’s luster. While it\’s still one of the most popular sites, it\’s not like it once was.

    Youtube is popular now, but if they are giving people some money for conent, some people won\’t like it that hey \”it\’s free on XYZ Tube or ABC Tube has no advertisements, so I\’ll just go check it out on their site instead of on youtube.

    While there are many things big corporations do extremely wrong, the theory was the internet and the \”new business model\” would bankrupt half the corporations. The \”new business model\” would change everthing.

    Well then the dot com bust happened, the \”new business model\” seemed more like a joke than real and many of those same evil corporations took over the internet.

    Google is now becoming a large corporation that buys every thing in site. Microsoft is a large corporation. News Corp bought MySpace and is trying to buy the Dow Jones and the Wall Street Journal..

    So for all the \”evil\” corporations out there that people hate, it certainly seems most of the sites people visit often are owned by these same corporations.

    Comment by Peter J -

  19. There are far too many people in today\’s society who seem to be nothing more than leaches. Everything should be \”Free\”…. Yeah it works if you are \”Mark Cuban\”, \”Bill Gates\”, \”Google\” and so on.

    It\’s one thing if you have a web cam and talk about your boring life or you upload some basketball or movie highlight. But if you are somebody who spent a lot of time and money producing some video, you\’ll probably get pissed if you don\’t get a dime for it.

    Put it this way, you make a great video about whatever, put it up on the net, and thousands of people watch it. Then Disney and MGM take your video. They like it and put it up on their site.. They then turn around and release a DVD/Movie. It\’s still your content, but hey, \”it should be free\” so they make millions off of it cause people pay to see that movie in a movie theater or bought the DVD. You, the original creator, get nothing because hey, \”you believe everything should be free.\”

    And why would anybody pay you or need you if they can just go out and find the next free video to make millions off of.

    Don\’t come crying to the world if you want everything to be free and suddenly the big bad corporations start doing what you wanted.

    Comment by Peter J -

  20. Regardless of all the issues raised, regardless of what YouTube becomes, it is irrelevant at the end of the day.

    We all know that the net favours the niche and the anti-broadcast. The net is about narrowcast. The net is about functionality and utility.

    The moment YouTube does anything to contravene these values, we will just pack up and leave and join the next video site that springs up in its place to do a better job.

    Just because something is \”corporate\” does not necessarily mean that it is \”evil\”. That way of thinking is old-fashioned. It is tired and just does not cut it anymore.

    Some of the best things come from \”corporates\”. I challenge you to name a few of them. Give credit where credit is due.

    Comment by Joran -

  21. Mark,

    I enjoy your posts very much. You are a deep thinker. I know you are set for life financially, so it is very impressive that you take the time to speak up about issues. Thanks for caring.

    Comment by KindAndThoughtful -

  22. Well, as it is expected this is just the process of expansion, if you do not expand you just die. Obviously there is always all those crabs that want to mess with your growth and hold you down by usin the lawsuits. This whole web 2.0 generation and P2P already changed the way to make business and thus everyone will need to adapt, thus finding new business models that are profitable.

    GS

    Comment by Gustav S -

  23. I don\’t think Joost will cut it. They are not guerilla enough. I don\’t think they are going to get to define their industry.

    Comment by Joran -

  24. Well time will tell! Perhabs US is ahead? But the Old Continent is comming! The demand on visual demand instead of music or plus music is growing!?

    Comment by Mainz -

  25. Interesting to see how this will evolve. Clearly content is king, but with the prospect of money now on offer the volume of adhoc clip content will increase significantly, potentially driving out the good content ala market for lemons…

    Comment by Stuart -

  26. Pre Rolls suck –

    – Glad to see Google, use other methods.

    – How long can YT go without being majorly profitable?

    – I think they made 15mill last year, that is not on par for the 1.6bill they paid

    Comment by pallet Jack -

  27. There is a difference between CNN.COM showing a tornado video without paying for it, and YouTube showing a tornado video without paying for it — just the same as a multi-billion dolloar company not paying it\’s fair share of taxes is worse than an individual who makes $20,000 a year not paying his fair share of taxes. The larger and more powerful an entity is, the greater resposibility morally that entity holds to do things properly. If someone makes a star wars parody and posts it on YouTube, George Lucas isn\’t going to sue. But if MTV made a TV show that parodied Star Wars too deliberately and was making money from T-Shirts and DVDs, George might sue.

    Comment by Nathan Andersen -

  28. More ignorance:

    It is \”YouTube\”….
    before you opine, perhaps you should look at the site.

    Comment by Robert -

  29. greetings from germany. if i would create content and hope to earn money with it, it would suck if other \”Tom,Dick and Harry video hosting site\” would host this video too but without earning money from them. I think i wouldnt run accross other site for deleting my content. sorry for english :)

    Comment by biatos -

  30. Agree on all points except pre-roll ads. Most research has shown that while pre-roll is the easiest way to monitize video content, it is also the most annoying to consumers and thus some publishers are starting to move away from it. Google, for example, is not using pre-roll as their video advertising outlet. Instead they are essentially putting a frame around the video (imagine a 1/4 inch margin above or below the playing video) which hold logos, text, etc. for the sponsors. Shockingly, it works pretty well.

    On all other points, you are about right.

    v

    Comment by Vic -

  31. I believe that google is trying to say something, and as usual is hedging their bets watching the market to see what horse will come in first, instead of just picking one. Where would youtube be today had they ANTICIPATED LG15, instead of watching it all unfold?

    I believe we will see a shift in the practice and application of copy right law in the coming little while, and a new evolution in the business of artist representation and interpretation.

    Some of us believe we have the answers that google is looking for, and the funny part is we\’ve been right under their noses the whole time.

    http://www.myspace.com/anterockstar

    Comment by Tamara Morahan -

  32. It would really be cool if they paid anyone who made a video that got popular. So if I made a little stupid video that got popular and 500,000 people watched it, they sent me a rev-share check. I have no idea how much it would be, but it would inspire thousands of contests, and probably replace \”stupid human tricks\” on Letterman!

    Comment by Portable Generators -

  33. nobodys mentioning Joost? this thing is gonna be huge!

    Comment by Adan -

  34. I\’m guessing they will pay for the content then place their own ads into the videos. I think that\’s what Ben McFerren was saying on his post. Google has been trying to build a video advertising program that is based on the content of the video. Yahoo has been doing this as well (Mark\’s Yahoo/Comcast deal post talked of this).

    It\’s going to be interesting to see if the ads are more profitable than typical TV ads. If they are maybe we\’ll start seeing some google ads on cable TV.

    Comment by discount tire -

  35. You forget, Mark, that these rev-share deals with YouTube are non-exclusive. People won\’t need to police other video sites searching for their content, they\’ll just sign deals with those sites too. Many of them already offer such deals (Revver, Metacafe, etc.) and many more will follow.

    If you can get deals with the majors your video will probably become well-known enough that other sites will recognize it so that you\’ll be able to claim/control it to a reasonable extent. Beyond that, just let it roll.

    I suspect that this will be a non-issue for savvy producers.

    Comment by Rational Beaver -

  36. Forget other video aggregation sites; or Youtube\’s homepage for that matter.

    What about consumption from \”my friends\” when they view a video I posted on my myspace page?

    Youtube\’s homepage is dwarfed by this longtail.

    There are many \”isles\” to get to milk, but when it comes down to it, \”I\’m probably just looking for what\’s in my friend\’s cart\”.

    The majority of people out there are not motivated enough to search for new content on their own. Even the waitresses nest their admiration to only a handful of influential figures.

    To me, this strategy is not too much different than Google\’s adsense/adwords platforms.

    Advertiser signs up to advertise against particular keywords.

    Instead of scanning keywords on a page of content supplied by an Adwords participant, it scans the transcript of their video.

    We\’re not going to see pre-roll or post-roll; we\’re going to see watermarks that fade in and out according to a time sequence, each synched with the trans-script of the video. Think about MTV style credits but instead of artist/song/album name, think Google text ads.

    Technically speaking, as long as the ad feed is \”welded\” to video feed upon download, why does it matter if the video sits on someone\’s harddrive or on any other video site? Its not like Google couldn\’t update their inventory \”matches\” frequently as buying cycles change. I see those venues as additional exposure for the video and widerspread coverage for this new vehicle for Google adsense/adwords.

    Comment by Ben McFerren -

  37. What\’s the % of video that is watched in YouTube having been searched from inside YouTube and what\’s the percentage of video that is watched because somebody linked to it on a webpage outside youtube?

    Example (and a touchy one at that): I just watched the video of Matt Barnes dunking on Dirk on Game 6 because the Sports Guy recommended this video as the \”top highlight of the season\”. Had he NOT recommended it I wouldnt watch it or be interested on it. I wouldnt never even go to the sports section of Youtube.

    Remember Seth Godin\’s Spreading the Ideavirus: in this century it\’s all about Sneezers. THEY make the rankings. The effect that the corporate folks of YouTube have on what I watch is minimal. The chances of myself watching something that was recommended by someone I trust is much greater than watching what I\’m told to watch.

    It\’s all about the % of videos generated from \”content affiliates\” compared to YouTube organicly generated views.

    And trick to monetize traffic is to GIVE THE CONTENT AWAY instead of trying to restrict it. The more you give it away, the more you will have people interested in your product. It\’s more about faith than economics, but for a little film studio or independent artist it\’s better to have everyone watching their video than nobody watching their protected video.

    Who will send a 5mb video file to their buddies anyway? That\’s stupid…

    Joost being around the corner and content providers ligning up to be a part of it is just proof that having any audience at all is more important than locking things up.

    Comment by Henrique Valle -

  38. Mark –

    You make a number of good points, but your entire premise is based on the conclusion that the head honchos at YouTube would override the wishes of the YouTube community and bump up the videos they\’re paying for to the top of the list. The problem with that is that if that happened, the YouTube community would be up in arms, so much so to the point where YouTube would either face extinction from a mass user exodus, or would be forced to change the policy. Now, admittedly there aren\’t any controls in place to keep YouTube from doing this, but I think they understand that without their users, they\’re sunk. It doesn\’t make sense to alienate your entire user base just to satisfy the copyright holders, and Google has shown that it\’s willing to defy them before, to the greatest extent they can. I have to believe that if Viacom or any other content creator/distributor demanded that the content they sell were bumped up the rankings, YouTube wouldn\’t budge.

    Comment by Adma -

  39. Widgets that serve ads are not allowed on MySpace. So when this program starts we may see MySpace blocking these videos.

    Comment by Hashim -

  40. Well, let\’s face it: the television industry and content providers cannot get over their fury at the fact that they can\’t pin down and manipulate viewers anymore: the people who are addicted to youtube are not interested in pre-interpreted content. OR production values for that matter.

    They don\’t define how hip they are by what television shows they watch and want content programmed by users. This is a generation of people that communicate through the tastes of a virtual society…and the one saving grace about it is that it cannot be bought.

    Of course, suits will whine about this for years but this is simply because their approach to content is an ancient as the city of Rome.

    Comment by Angelo J. Guglielmo, Jr. -

  41. The value of user-generated content is determined by users. While it\’s true Youtube can \”market highlight\” particular videos, any video stands a chance of breaking the viral barrier. Last time I checked, it\’s impossible to get airplay on Clear Channel for new music. The option to upload new music and get airplay is nil. Not so for Youtube. Bad analogy.

    As I noted back in October:

    16. It\’s suddenly clear why Google bought Youtube: it\’s their answer to sites like Revver which offer compensation for user uploaded content. Google will share revenue derived from the content with the uploader, any copyright owners, and Google of course. A simple solution to the potential growth of revenue sharing video sites. Smart!

    Posted at 6:35PM on Oct 9th 2006 by Christopher Peterson

    http://www.blogmaverick.com/2006/10/09/i-still-think-google-is-crazy/

    Comment by Christopher Peterson -

  42. hey Mark, I was just curious about what you think of Joost.
    Joost is a program for TV shows and video over the Web using p2p technology. they are already broadcasting shows from FOx, Warner Music, National Geographic etc. Even some very interesting new chanels. Im currently beta-testing it and so far, I like it. I think it could blow youtube out of the water. for one thing the video is clear and has a higher resolution (same as TV) it does need work, its a giant memory hog (it runs slow on 2 gigs) it would require a more streamlined interface, if it hopes to stay alive. hope to hear from you.

    Im a Spurs fan, but I really enjoy your blog.;)

    Comment by Adan -

  43. Mark,

    Some of your opinions on this matter are just ridiculous. YouTube will never touch DRM becuz Google has always been doing the opposite as the companies who use DRM…. Google understands that DRM would hinder their content and make it LESS VALUABLE to their viewers. Why make content less valuable? All you do is lose money cuz customers are your main source, always will be.

    I like how you\’re raising many questions about how YouTube might handle some of these issues. It will be interesting to see how both Gootube and the content creators react to various scenarios. But if I was calling the shots at YouTube I\’d make some sort of clause saying any uploaded material by content creators automatically goes into the public domain. The content creators get paid for their works, but they can\’t go take it down from other sites, cuz it\’s public domain material. Like an agreement between YouTube and the paid content creator.

    Surely someone getting paid for content will be willing to give up the copyright on the material. After all, more exposure is better anyway for the creator in most cases. And what if the creator doesn\’t wanna give up copyrights? Well I guess he/she then goes to another video site and uploads there or sells their content somewhere else. Of course the downside is YouTube is the most viewed internet video site, so not posting their content on YouTube and would mean that content creator loses the chance of maximum exposure and they have to look elsewhere.

    Comment by James Stevens -

  44. I think it\’s also important to consider the quality aspect as well. I rarely go to Youtube to search for videos–I just don\’t have that kind of time. Rather, I catch links on Digg or get sent them via e-mail.

    But quality content is another story and one I\’d be willing to pay on the front end for–this has to be attractive to content providers. For example, I was very pleased to see your channel HDNET Movies provide a sneak preview of the movie Diggers before it even came out at the theatres. Since I enjoy watching videos on my home theatre system even more than going to the movies, I\’d actually pay $10 a movie to stay at home and watch it on HD.

    The head of the snake is what content providers should be marketing to–let the long tail take care of itself.

    Comment by Joshua Minton -

  45. It\’s the age old theory of \”If it doesn\’t happen to me, it doesn\’t matter.\”

    Post other people\’s videos up on a website and everything is fine. Then complain when the big bad corporations and government try to hinder your freedom. Complain when \”big brother\” seems to spoil the party and spy on you.

    But at the same time, post everything about yourself, post your whereabouts at all moments of the day, purposely buy cell phones that track you and call it new cool technology. And then complain when your personal information and videos are blasted all over the web and demand it be taken down.

    \”if it doesn\’t effect you, you probably don\’t care..\” But as soon as an \”Alex Baldwin\” type video or audio or Paris Hilton type of video or audio of you is Dugg across the internet, it no longer is something that is funny.

    It\’s easy to demand \”free choice\” and down with the big bad corporations and governments. But when those things you profess about start to make you life miserable, it isn\’t so easy to be free. Too many Hypocrites on the web and in the world.

    Comment by Peter J -

  46. There is a sad truth here. Even though networks like Viacom are in the right and youtube deserved to get sued, they simply cannot beat piracy. It is too simple to do. Unfortunately the only way to win is to try work your revenue stream around things that are not easily bootlegged.

    Comment by superdave -

  47. Something dawned on me, today, looking at an amateur Tornado Hunting video, on YouTube… Networks (and production companies) are getting furious that their content is being viewed \”for free\” on sites like YouTube. And, so, they are suing. To some degree, this makes sense. Their work is being used w/o their express consent. But… what about the shoe on the other foot?

    Isn\’t it only a matter of time until networks return this \”favor?\” As it stands, CNN has to get the rights from guys like the tornado videographers, if they want to air the content. But who\’s to say that they don\’t start returing tit for tat… and start showing amateur footage WITHOUT getting the rights?

    Isn\’t a precedent being set one way which will, surely, end up going the other way as well?

    Comment by Jeff Davenport -

  48. Read Eric Schmidt interview with Wired.

    http://www.wired.com/techbiz/people/news/2007/04/mag_schmidt_trans?currentPage=all

    He makes it clear their business is search and advertising. They are a technology company. He also makes it clear that Google is not responsible for policing copyright as defined by the DMCA, as written by the content providers themselves. What we currently have is classic \”law of unintended consequences.\”

    Looking at it through that lens, it seems pretty clear what YouTube\’s stance is.

    Comment by Tim -

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