getting YouTubed

Mark Glaser of PBS’ MediaShift did a short interview with Chad Hurley, CEO and co-founder of YouTube. The timing couldn’t have been better. The next day, YouTube received another 8 Million USD in VC capital.

For the still uninitiated: what’s YouTube anyway? Well, have some looks:
The pro’s voice. A user speaks. A user’s prank. And in their own words (huh?).

But seriously. YouTube, built as some sorts of Flickr for Videos, is most likely the best thing what could happen to video on the web. Think about it: streaming video is around since 19hundred umpteen. And nobody did ever really care. Why? Let’s start with the user experience. Proprietary players which had to be started before they started buffering the video. One of the worst offenders: Microsoft’s Windows Media Player, an unwieldy chunk of counter-intuitive interface design. With Real coming in as a close second in the jack of all media-trades category. And Apple killed of any love for QuickTime with their constant Windows nagging screens.

Secondly, serving video always came with a hefty price tag attached. Even if you didn’t need any expensive server software to get the video files out. The fastest thing to kill your business hass been: success. Serving one video is fine. Serving a million is still a major head ache. If you don’t put your stuff on sites like YouTube, Google Video, vSocial, Veoh.
What those guys achieved, Glaser puts it in the right words: There is a simple truth about video-sharing site YouTube, and an enigma. The simple truth is that this web startup has bottled up the viral video idea and made it eminently drinkable by anyone.

But what’s the enigma? It’s how YouTube will profit on its own spectacular popularity. Yup. Good question. Being VC funded or not, sooner or later you’ll have to make money. The numers are spectacular (35 million videos per day, and users upload 35,000 videos per day, with 100 million page views per day).
So what’s YouTube’s idea to monetize this kind of success?

Hurley’s answer isn’t that clear. It will be an advertising-based model. We are exploring ways to serve up relevant advertising that will benefit the viewing experience since we know a lot about each of the videos based on how they are tagged.

Sounds good. But it’s going to be hard to deliver ion this.

Let’s start with the content. 35,000 uploads a day and a staff of 23 means: It’s impossible to double check all the posted material. Actually, YouTube is doing a good job in not putting up any porn on the start page. But if you look at the numbers, most viewed means mostly copyrighted material coming out of nowhere.

Probably 90 percent of the images hosted at Flickr are genuine user generated content. Looking at YouTube, you’ll have to define “user generated” a bit laxer. Does recording a tv show snippet and posting it on YouTube already qualify you as a user generating content?

With this premise, selling advertising looks tough to me. Tagging a stolen clip with a paid for ad would definitely be a bad business move. Copyright holder don’t tend to be too amused. And advertisers most likey will shun to become an accessory after the fact.
We have been moving cautiously to ensure we don’t disrupt the goodness of the community, says Hurley. But at the end of the day it’s the viewers that decide what is entertaining whether it be user-generated content or professionally produced videos — our community is still in control and will decide what rises to the top.

Yes, at the end of the day the users might still decide what’s entertaining. But currently, YouTube et al. aren’t in the business of Flickrization of the web video space. The name of the game is napsterization. Remember: Gazillions of hapyy users. But not even a serveral million Dollar backing of a major media company could save Napster from being sued to death.
Yes, YouTube’s a great service. But, in most likelihood, not a great business model.

Via MediaShift

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