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YouTube Growing ... Like Cancer? 174

Posted by Zonk
from the i-want-that-kind-of-disease-problem dept.
PreacherTom writes "The success of YouTube has been staggering: they currently field 100 million videos per day and have attracted the attention of influential people like Bill Gates, who may be planning his own video hosting service. However, growth does not always equal profitability. Incorporation of ads risks their very base. If that were not enough, like Kazaa, they struggle with the Damocles' Sword of Litigation hanging over their head each day while bandwidth and server costs continue to rise. Is this phenomenal growth only rapidly killing our favorite video warehouse?" From the BusinessWeek article: "YouTube could easily alienate its users by overwhelming them with ads. And the startup has to figure out how to attract a broader group of marketers by filtering more for copyrighted or offensive videos and by creating more channels of similar content. Aware of the risks, YouTube co-founders Chad Hurley and Steve Chen are moving slowly to ramp up advertising. They have been wary of asking viewers to sit through a 30-second ad before a two- to three-minute clip. Instead, YouTube is developing new formats, like ones rolled out in August that let marketers build their own video channels or pay to place a video on YouTube's popular front page."
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YouTube Growing ... Like Cancer?

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  • by ackthpt (218170) * on Friday September 08, 2006 @11:54AM (#16066764) Homepage Journal

    Is this phenomenal growth only rapidly killing our favorite video warehouse?"

    Which one would that be? I don't rent videos. More likely it's a sign that people are more interested in content than quality. Many of the videos I've seen are very poor grade, while the few who really care about HD-DVD and Blu Ray squabble off in the corner.

    YouTube could easily alienate its users by overwhelming them with ads.

    This has in my experience been proven unfounded with Yahoo, Google, eBay and slashdot as examples. Bring on the ads.

    [legal threat] hanging over their head

    I expect this is due to the fact many videos are edits from television, easily spotted by the Sky or whatever logo in the corner.

    pay to place a video on YouTube's popular front page."

    Oh the vanity! People really do that??? If I want you to see my video I'll put it on my own site and mention it somewhere, maybe even slashdot and it it's interesting word will get around, if it's not, my ego won't be crushed. I will be pissed if those weasels at thinkgeek steal it for another merchandising product.

    It is rather amusing to look back several years, if you remember a particular broadcast of some dot-commer telling someone at CBS(?) they would be burying the network, with whatever the heck it was this particular dot-commer had to offer over the budding internet. His company, IIRC went bust with a lot of others. Now look at the rabble scrabbling on YouTube, Google Video, their predecessors and whatever else will come along.

    • by b0r1s (170449) on Friday September 08, 2006 @12:05PM (#16066878) Homepage

      This has in my experience been proven unfounded with Yahoo, Google, eBay and slashdot as examples. Bring on the ads.


      The difference, of course, is that most of YouTube's bandwidth (read: expenses) comes from embedded video players on other sites. The people embedding these videos want the videos - not the ads. Unlike the examples you cite, where ads are placed around content, ads in videos must be placed before, during, or after content - replacing the content for the duration of the ad. This interferes with user experience, which is why it's fundamentally different than Yahoo, Google, eBay, and Slashdot.

      • Re: (Score:2, Interesting)

        by Ciarang (967337)
        There's no reason why they couldn't amend the video directly to put ads 'around' the content, such that they'd still be visible in an embedded player. Or they could overlay ads. Still, I'm not convinced that level of bandwith usage is ever going to be covered by non-obtrusive ads.
        • by 70Bang (805280)
          "pay to place a video on YouTube's popular front page."

          Oh the vanity! People really do that??? If I want you to see my video I'll put it on my own site and mention it somewhere, maybe even slashdot and it it's interesting word will get around, if it's not, my ego won't be crushed. I will be pissed if those weasels at thinkgeek steal it for another merchandising product


          snicker. Listing Upgrade - Home Page Featured Examples [ebay.com]. Look under "Example 3": Home Page Featured fees vary depending upon the type o
      • by bitflip (49188) on Friday September 08, 2006 @01:24PM (#16067485)
        The trick isn't that the ads are not part of the content, the trick is that they are mostly unobtrusive.

        If they try to put a 30 second, or even 15 second ad at the beginning of a two minute video, then it is highly likely to drive people off.

        But what about a two-second video, consisting mostly of a logo? Before the video starts, you see the "Intel Inside" logo, with their trademark chime, for example, which then quickly cuts to the desired content. If it is quick enough, then it will be effective at building brand awareness without giving the viewer time to hit the "back" button.

        I'm sure that advertisers would like us to sit through something longer. I'm sure they'd like for us to do nothing but watch ads. They need to make the ad fit the medium, in this case short videos.
        • Re: (Score:3, Interesting)

          by Zaphod2016 (971897)
          I'm not sure I would pay (as an advertiser) for a quick glimpse at my logo. However, what if the screen was setup like those horrible cable news channels: content above a small "strip" of ads at the bottom. Would that be a fair compromise?

          Buy product X...Go to this new website...Scam Co needs your money...

          Unlike the TV, if one of the ad headlines grabbed me, I could "take action" (click) right away, whereas with TV I tend to just surf away from commercials as soon as I realize it is a commercial (thos
          • by Firehed (942385)
            Those ads are the ones that really annoy the shit out of me. One of two things happens: I'm watching the ad (because it's very distracting) thus missing the product, which I then turn into feelings of hatred towards the company and making sure to NOT purchase from them; or I'm just watching the content and completely ignoring the ad. Any sites that force embedded ads over usually five seconds or so don't get any return traffic from me, and, again, the bad feelings towards the advertiser. A few-second thi
        • by xtracto (837672)
          But what about a two-second video, consisting mostly of a logo?

          Hey that worked for me, I went to one of those videogame site (dont remember if it was IGN or gamespy or the others) looking for a video of the upcoming Dragon Quest game for the Wii. Before watching the video I had to watch something like 20 seconds of a Snickers add, after watching it I was able to see the 3 seconds video of the game. The thing is that I did got the desire to get a Snickers... grrr and the worst thing is that now that I remem
        • Re: (Score:3, Interesting)

          by boingo82 (932244)

          I'm sure that advertisers would like us to sit through something longer. I'm sure they'd like for us to do nothing but watch ads. They need to make the ad fit the medium, in this case short videos.

          You know, I TRIED to do that...I tried to watch nothing but ads...there used to be a fun, free service where I could sit and watch ads. Maybe you remember it - it was called adcritic? You know what happened? It went to subscription. For a while it was around $400/year. Now it is $99/year. WTF? How is that youtub

      • ads in videos must be placed before, during, or after content

        You know, I wouldn't mind ads after the content.

        It's wen they get it in their minds that they should interfere with my access to, or enjoyment of the content that I turn into a crafty pirate and I go in full circumvention/tech-savyness mode.

        But afterwards? Once I'm satisfied... I wouldn't mind. It would make avoidance of stupid/irrelevant/redundent/inconsequential ads easy (hence why they don't want to do it this way) but unnecessary, and I would
    • Re: (Score:3, Insightful)

      by truthsearch (249536)
      This has in my experience been proven unfounded with Yahoo, Google, eBay and slashdot as examples. Bring on the ads.

      Those sites introduced unobtrusive ads relatively early in life. If Google put up interstitial ads (basically the web page equivalent of a commercial you watch before showing a video clip) everyone would be very annoyed. If eBay made you click through ads before seeing an item's detail they'd lose a lot of visitors. It's very important to introduce ads early and in a way that will alienate
      • Re: (Score:3, Interesting)

        by ackthpt (218170) *

        If eBay made you click through ads before seeing an item's detail they'd lose a lot of visitors.

        I don't know where you've been, but I'm running into these things constantly on eBay and paypal -- I'm taken to a full page ad I have to find the button to get past to go where I was intending to go, not this fscking billboard.

        Alas, I'm still there because I want to buy, sell or pay for stuff, so I have to put up with it. If YouTube's offerings are good enough they can probably pull it off as long as they ar

        • by hpavc (129350)
          Yeah, ebay is a perfect example of how youtube could fail. Ebay is basically done with innovating and are just shaving more and more metal off each coin it seems.

          The place has the same usability staff as myspace.
      • by pete6677 (681676)
        Exactly. The obnoxious ads are primarily a result of clueless marketeers failing to realize the internet is NOT the same as TV. The sooner they abandon the 30 second annoyingly stupid commercial, the better off they will be.
      • IGN has the click through ads and it doesn't bother me at all. I'm still on there.
    • Re: (Score:2, Insightful)

      by urbanradar (1001140)
      > This has in my experience been proven unfounded with Yahoo, Google, eBay and slashdot as examples. Bring on the ads.

      That's different. Yahoo, Google, eBay, Slashdot, etc. show ads as part of a website. You can just ignore them, you can still access the content of the website you're looking at while the ads are on-screen (and nowadays, you can easily block them if they bother you that much, too).

      YouTube would most likely have to integrate their ads with their videos. An ad before a video starts act
    • by Kenja (541830)
      "Oh the vanity! People really do that??? If I want you to see my video I'll put it on my own site and mention it somewhere, maybe even slashdot and it it's interesting word will get around, if it's not, my ego won't be crushed. I will be pissed if those weasels at thinkgeek steal it for another merchandising product."

      Um, sure they do. You see, unlike yourself some people have somthing to sell. Bands such as "ok GO" (just to name one) will pay to place their video on the front page because it sells CDs an
    • by identity0 (77976)
      pay to place a video on YouTube's popular front page."

      Oh the vanity! People really do that??


      Think guerilla marketing... Now, instead of stupid people doing dangerous stunts, you'll get to see stuntmen acting as stupid people doing dangerous stuff, then quenching their thirst with Gatorade(TM). If they ever fully enforce copyright laws on YouTube, the only things left will be home videos and product placement ad videos.
    • by raehl (609729) <raehl311@yFREEBSDahoo.com minus bsd> on Friday September 08, 2006 @12:30PM (#16067081) Homepage
      Oh the vanity! People really do that??? If I want you to see my video I'll put it on my own site and mention it somewhere, maybe even slashdot and it it's interesting word will get around, if it's not, my ego won't be crushed. I will be pissed if those weasels at thinkgeek steal it for another merchandising product.

      If you have video content that you want internet users to see, like a commercial, the front page of YouTube is a very, very good place to put it. Why? Because the people looking at the front page of YouTube are, by definition, people who both CAN and WANT TO look at videos on the internet.

      It's otherwise hard to get video content to internet users. Many don't have the bandwidth or the software to play the video in the first place, others you risk angering by essentially taking over their sound system to display your ad.

      People going to YouTube are already predisposed to WANT to watch videos. That's what they are there to do.

      So, I'll go ahead and solve YouTube's problem for them: Like Google, have a 'paid placement' section alongside the rest of the videos. Let people pay to have their videos where people can see them. You might even let people pay to have videos display with ceretain keywords. Maybe I search for 'Dew' and along with the rest of the results, I get the latest Mt. Dew commercials. Just like I find the ads returned with search results on google HELPFUL when I'm using Google to search for a commercial service, I might find video ad results helpful when searching YouTube for videos.

      Don't piss off your users by MAKING them watch, or by having the videos run automatically - leave it to the advertisers to generate YouTube commercials that are ENTERTAINING. Then let YouTube do what it does best - spread the word about entertaining videos.

      There's also a bonus here - there's no reason that the person who charges the advertisers NEEDS to be YouTube directly. If I can buy placement for my video, I might get an advertiser to pay me to create a video, integrate their ad into my video, and then pay YouTube to make sure my video gets seen. You could create a whole new advertising medium where video producers effectively 'buy airtime' on YouTube through paid placement and then pay for that by selling commercials or product placement within their videos to other advertisers.

      YouTube would then become essentially the TVGuide of internet video content: Everybody with an internet video gets a listing, but people who want to pay get the full-page ads.
    • YouTube could easily alienate its users by overwhelming them with ads.

      This has in my experience been proven unfounded with Yahoo, Google, eBay and slashdot as examples. Bring on the ads.

      A previous poster already mentioned that adverts before or during the video stream are highly annoying to users. But there is another concern that even remains valid if you thought about text-based ads next to the video (if you like, the Google model): As the Economist recently pointed out, the trouble for advertis

    • by rm999 (775449)
      "More likely it's a sign that people are more interested in content than quality. Many of the videos I've seen are very poor grade, while the few who really care about HD-DVD and Blu Ray squabble off in the corner."

      I don't expect quality when I watch a 30 second video of a cat jumping into a wall. I do when I am watching a full length movie on my projector (or even 20 inch television, for that matter).
  • by grapeape (137008) <mpope7NO@SPAMkc.rr.com> on Friday September 08, 2006 @11:58AM (#16066812) Homepage
    "YouTube could easily alienate its users by overwhelming them with ads. And the startup has to figure out how to attract a broader group of marketers by filtering more for copyrighted or offensive videos and by creating more channels of similar content."

    YouTube could easily alienate its users who are mostly there to see the copyrighted and offensive videos to start with. Cleaning up YouTube might attract new marketers at the start but when the numbers decline what will YouTube have left? Sadly funny home video sites are a dime a dozen, YouTube has survived off its own lawlessness...kind of a catch 22 for them. I know I wouldnt want to own stock in them.
    • Re: (Score:3, Insightful)

      by monoqlith (610041)
      I don't necessarily think that's true.

      If you look at most of the "top rated" and "most rated" titles on YouTube right now, onlya few of them aree clearly coyrighted and illegally posted. When i go to YouTube it's mostly for original works that I can't see anywhere else.

      And there a lot of situations where an illegally uploaded YouTube movie could conceivably benefit the copyright holder - in the case of posted television advertisements, for instance. Imagine all that free publiciity with literally ze
      • by vanyel (28049) *
        I've always said, if you want me to watch your ads, make them interesting enough to want to watch. There are any number of them that fit that bill: the Toyota RAV4 commercial on You Tube is one I've shown a number of people. Charge for hosting commercial videos like that and it'll pay for the rest...

        How well they work is another matter... several years ago I created some ads for the interior of bus and light rail for my ISP business. They were designed to be interesting to look at and read, while demonst
    • One of these days, advertisers are going to have to realize that there are more americans interested in 'offensive' things than there are interested in 'wholesomeness', and accept that if they want to reach the largest market possible that it's ok if their ad runs next to a list of results for 'asian schoolgirls'.
    • by soft_guy (534437)
      YouTube could easily alienate its users who are mostly there to see the copyrighted and offensive videos to start with.

      I have not really seen a lot of content on YouTube that I would call offensive. Believe me - I've looked!
  • YouTube could easily get away with putting a static ad on the movie before it plays the first time. This wouldn't be too annoying and tied in with google adsense would work really well. Maybe it could be a transleucent so you could still see what the video was. I wouldn't mind that much, but any ad I have to actually sit through means a adblock on http: //*youtube.com/*
    • Re: (Score:2, Interesting)

      by Anonymous Coward
      They should think outside the box and put the ads after the video. Seriously, I wouldn't be surprised if it turns out that post-ads are viewed less frequently, but more effective enough when they are viewed to make up for the smaller eyeball share. Or they could just start their own cable channel.
  • YouTube Growing ... Like Cancer?
    Well, I always considered it a Pox, but if they want to upgrade it to a cancer, that's fine with me! Just means it will be attacked more forcefully when it's finally found.
  • by zaqattack911 (532040) on Friday September 08, 2006 @12:00PM (#16066831) Journal
    Honestly, I don't get this web 2.0 "problem" of more adds = angry community.

    It's no secret these massive community sites cost a lot of money, anyone expecting to get it for free should expect to be subjected to some form of advertising.

    As long as they don't overwhelm the user with 1024x768 flash popups forcing you to watch a 15min coke add, I don't see the big risk of adding more advertising. WAKE up... money makes the internet tick.
    • The example they gave of a 30 second ad before a 3 minute video clip. Like a user wouldn't be willing to spend 15% of the time viewing ads.

      I know this is groundbreaking, but it's my contention that a user just might be willing to watch, say, 20 minutes of ads for every 40 minutes of programming. Yes, I know this sounds CRAZY but trust me on this one....
      • Re: (Score:2, Interesting)

        by lotrtrotk (853897)
        youtube is obviously the biggest player in this market right now. But Google, Microsoft & others all have the ability to fill that void, ad-free. If another company can provide the same service with no ads, how many viewers are going to stay just because its youtube? It may take some time for people to descover other sites. But I think eventually, the ads could push a lot of viewers away.
    • by pla (258480) on Friday September 08, 2006 @12:52PM (#16067241) Journal
      Honestly, I don't get this web 2.0 "problem" of more adds = angry community.

      Well, let me put it in very simple terms - We found ways to gather and chat, for free, LONG before "Buzzword 2.0" ever appeared on the scene. Why should we have to start paying (with our time) for what we've had all along for free, just because some Johhny-come-lately media megacorp gave the same-ol a spitshine?



      WAKE up... money makes the internet tick.

      Wrong.

      Those who have money want you to think they run the internet. The internet, however, exists without CBS and MSNBC (you could argue it wouldn't have existed without Ma Bell, but she only owns one of many possible physical layers that it can use).

      YouTube, while not necessarily a viable business model, serves to prove this point - Copyright violations aside (though I don't mean to minimize how much they help), people flock to seeing all the low-quality home-made content - All the stupid pet tricks, stupid accidents leading to minor injury, camwhores, accidental news coverage, and even some of the less pathetic video blogs. NONE of that depends on having oodles of money. It all comes from the users, not the distribution method.

      Yes, someone has to serve all that content, but without YouTube, we'd just find it scattered around the 'net, hosted at a million tiny personal sites rather than one large aggregation of such content.



      But please, don't ever make he mistake of considering the internet anything like traditional broadcast media, where only the Big Boys with Big Bucks can ever even hope to have any control over it. WE currently control the net, and will continue to do so unless we throw that away for glass beads and whiskey.
      • by shmlco (594907)
        You're missing his point. Any large content aggregation site that attracts a big audience and serves up content off it's own servers has to pay for those servers and for all of that bandwidth somehow. It's the nature of the beast.

        It could be with ads, or donations (doubtful), or paid placements, or by corporate sponsorship (aka Wikipedia), but SOMEONE has to pay the bills. It could be "scattered arount the 'net" as you say, but then you lose one the biggest things that makes a site like YT popular: it's gat
        • So you have heard of BT. Good. So what if it adds more complexity? It's still viable. Peer to peer networking for streaming content is difficult, but it's been done before. The difficulty isn't in designing a network that's technically able to deliver the goods in a distributed manner, the real difficulty is in seamlessly integrating it into the browsing experience. In theory, BT could be integrated into the browser just like any other transport like HTTP or FTP: Opera already downloads torrents, but the ta
          • by shmlco (594907)
            Again you miss the point. YT gathers movies up and makes them easy to access. It's a place to send your stuff and have it be seen. Scattering things hither-and-yon across the web makes it harder. BT makes it harder. The explosion of different formats will make it harder. Not having categorization and rating and commenting systems makes it harder and much, much less useful.

            YT could use BT to distibute files and STILL need to pay for the millions of page views needed to host those other services, because it's
            • Huh? I did not talk about replacing YT with a normal BT tracker, I'm talking about seemlessly integrating BT (or any other P2P transport) as an alternative to the typical method of delivery, HTTP. YouTube could look virtually identical to the way it does today, but every file larger than 10k is distributed via BT instead of HTTP. This includes the web content, although distributed serving of dynamic content really is difficult. I think serving just the static content - including the movies - over a P2P netw
    • I don't get this web 2.0 "problem" of more adds = angry community. [...] anyone expecting to get it for free should expect to be subjected to some form of advertising.

      You don't get human nature: not wanting to be subjected to unpleasantness.
  • by moracity (925736) on Friday September 08, 2006 @12:01PM (#16066841)
    All the social networking and video clips companies are just leading the charge to the next bust. The business model seems to be:

    1) start "social" website
    2) grow user base
    3) ??
    4) get bought out by Big Company X
    5) profit!
    6) site dies because it was lame to begin with
    7) SUCKERS!!! - Precious Roy
    • by revlayle (964221)
      I think there will be a bust, but only in a certain PORTION of the world wide web. The first wave of actually useful sites that survived the first bust (and children of such successful online ventures) that do generate revenue I think will be sticking around. Web development personnel are building more and more intranet applications (larger demand than maybe 5 years ago IMO), so the job market may take a slight plunge, but I don't think nearly as bad as before. Yes, investors will get skittish, but I am
  • I honestly would have to agree that it's finally come time for YouTube to start thinking about the whole "revenue model" thing.
  • I think the folks at youtube are aware that a ton of ads will piss off and lose them some users. I don't see any problem with introducing revelant, inobtrusive text ads. Why is everyone jumping to the conclusion that the only way that Youtube can survive, "in the real world," is to hold its users' heads under water with a torrent of advertising?

    It doesn't have to be that way.
  • Who's favorite? (Score:5, Informative)

    by Matt Perry (793115) <perry.matt54NO@SPAMyahoo.com> on Friday September 08, 2006 @12:06PM (#16066893)
    Is this phenomenal growth only rapidly killing our favorite video warehouse?

    Speak for yourself. Google Video [google.com] is my favorite. It has a picture that scales to fill up unused space in my browser window. Plus, as a content creator, I can upload videos larger than 100MB which you can't do on YouTube. YouTube's limitation can make the quality of your video suffer if it is too long (20 minutes or more).
    • by arth1 (260657)
      Google Video is useless unless you have the right OS, right browser, right privileges, and want to watch the movies on the particular computer you're sitting at. There's no way to show the videos on my Showcenter, download them to my PDA, or watch without an active network connection.

      Granted, YouTube isn't all that much better -- it's just a different but similar Flash player.

      Heck, even on my Windows machine, I have to watch the Google/YouTube movies without sound, because Flash won't let me configure what
      • Google video's quality is much better than youtube's in terms of compression and the site is quicker and less busy so I try to use it much more than YouTube.

        YouTube however seems to be more social so some content is easier found on their site. Both however are very pervasive...My music professor loaded up a few youTube videos for the class back in april or may which shows that there is even some sort of legitimacy to it.

  • If a YouTube is anything like a "u bend", then you pretty much know it will be transmitting large amounts of crap sooner or later, ads or not. Based on the last time I checked, sooner.
  • Front page? (Score:3, Interesting)

    by MoOsEb0y (2177) on Friday September 08, 2006 @12:12PM (#16066933)
    People look at the front page of youtube? That's news to me. Only time I ever see youtube is when a video's linked to by a blog mentioned on a slashdot web 2.0 competitor's website...
    • >People look at the front page of youtube?

      I do... I'll often skip over there when I'm eating my sandwich to see what's new and amusing / interesting.

  • by MikeRT (947531) on Friday September 08, 2006 @12:12PM (#16066936) Homepage
    The problem with pay-for-play and other models is that there are big fees in the processing of the transaction. They should set up their own little financial system where people can transfer $5 from their bank account and then just directly transfer the money from there. ING Direct does this transfer for free for me, so I can't see there being any expense for them to do this on small payments. It'd require some overhead, but it'd be worth it as it would quickly infuse their site with a lot of cash. They could then just charge literally $0.01-$0.05 per transaction and make good money. That way, a $0.25 tip would earn several times more than it would on iTMS for the artists.
    • Re: (Score:3, Insightful)

      by Overzeetop (214511)
      That solves the problem on their end, but not on the consumer's end. You see, a single purchase of a $0.02 video will now cost $5. Of course, you get an extra $4.98 worth of content for free on that specific site, youtube.com in this case, but you're still out $5 to watch the first video. No, the micropayment system would need to be well distributed, and V/MC/D/AMX don't really want to get into the $0.02 charge game, and due to their effective opoly/cartel status they don't have to.
  • by Stalyn (662) on Friday September 08, 2006 @12:13PM (#16066939) Homepage Journal
    I'm not sure if such a legal argument is tenable and as I'm not a lawyer I'm not going to attempt one. But the overall scheme is that sharing clips of copyrighted work without profiting from its sale should be considered fair use. The majority of television networks understand that the sharing of clips amongst Internet sites in the long run benefits them. It promotes their show and their network. That is why there isn't much of an uproar about copyrighted content on youtube. Of course entire works should be barred.
  • by jbum (121617) on Friday September 08, 2006 @12:14PM (#16066951)
    I made some lovely graphs [krazydad.com] to illustrate this growth. These graphs use actual thumbnails from youtube as data points.

    That's right - the medium is the message!

  • by Billosaur (927319) * <wgrother@HORSEop ... minus herbivore> on Friday September 08, 2006 @12:15PM (#16066960) Journal

    Charge a membership fee.

    Now, before everyone goes bonkers, lets think about this critically. Servers, the power to run them, the buildings to house them, the people to keep them running, the people to write the code that makes the site run -- these are not free. If you don't have a huge wad of cash burning a hole in your bank, then you've got to find a source of funding, one which won't suddenly dry up and leave you with no way to run the show.

    So charge for the service. Plumbers do it, lawyers do it (excessively it seems), hospitals do it... why not an Internet service? You pay your $20 a year and get free unlimited uploads. For those who don't like the model, you can have a free account, but we charge you a nickel for every upload. It might cut down on the megatons of crap that get uploaded, which would ease the strain on infrastructure and storage, generate constant revenue, which would ease money headaches, and generally improve things. And then, when YouTube gets so successful that it's ubiquitous, its CEO can embezzle huge amounts of money and leave the company broken while he sails away on his yacht.

    • by kamapuaa (555446)
      At the rates you mention, you'd have to upload 400 videos a year before it'd be worth it to subscribe to the $20/year plan. They'd have to charge more, and they'd probably want to charge additional fees for the highly downloaded videos that dominate the bandwidth.

      There's no real reason to have brand loyalty to youtube - it works pretty well, but the controls are simple and it'd be easy for another company to copy. If youtube charges even a nominal fee, a huge amount of their audience will just jump ship

    • by Peaker (72084)
      The barrier for me is giving my credit card or any other form of payment on the net.

      I don't trust today's computers' security with my money, and definitely don't trust sites to take only what they advertise to take.

      I don't have time to be critical of every spending of every cent from my accounts, and I don't have time to fight for my money back in cases of mini frauds.

      Its actually not the money that stops me from using internet services, its the mere thought of giving them a credit card number or such.

      I wou
  • P2P (Score:3, Interesting)

    by dduardo (592868) on Friday September 08, 2006 @12:15PM (#16066962)
    Someone needs to take the YouTube, et. al. concept and convert it into a P2P system that is easy to use. The p2p client could have a web interface to make it feel like current services and even use flash to show the videos downloaded locally.
    • by soft_guy (534437)
      If it were a P2P system, how would keep people from uploading one video and then substituting another video for it? (i.e. here's my nice video blog about ponies, but what I actually send out is goatse the movie.)
    • by timeOday (582209)
      I don't know of any current, widely adopted P2P technology that's any good for streaming content. (Although skype *might* count).

      Though as a consumer, I hardly care. It's true that providing a service costs money, but those actual costs are only tied to usage fees in such an indirect way that it's hardly relevant to the consumer. You think ebay bases their fees on how much they need to stay alive? No. It's however much they think they can get. In an ideal market those figures would be closely relat

      • That's only because ebay has no serious competition in the States. If it did, they'd cut fees back to costs (or lower, to starve the competition). The problem is that ebay is a kind of natural monopoly, since it's only worth listing your auction where people will find it.
  • by RyoShin (610051) <`tukaro' `at' `gmail.com'> on Friday September 08, 2006 @12:18PM (#16066989) Homepage Journal
    Posted this in a related Fark thread, and I believe it still holds:

    I think that, somewhat ironically, TotalFark shows how websites will survive in the future.

    Even with the increase in ads and ad revenue, consumers are wisening up and finding ways to block them, and soon that well will go dry. So you can either overload your site with ads (which, ironically, means none of them get exposure since the overload causes the user to ignore them all), or you find another method of income.

    The solution? Payable accounts. Take Fark as the main example. The majority of users enjoy a few hand-selected odd stories surrounded by ads. These ads are actually targeted towards the general Fark demographic, so they get a better CTR.

    Then there's TotalFark. A verifiable anarchy of submitted stories, good, bad, and ugly. There are dozens of threads a day from people whining about the mose inane shit. Half of the links are repeats. Once a day we get a headline telling us to Google "miserable failure". But you know what?

    A few thousand people pay $5/month to see that stuff, myself included. And all it really boils down to is getting more of the same stuff that the free people do.

    This is how most internet sites will eventually turn. You have free stuff and then you have better stuff that costs money.

    YouTube could offer high quality videos to paying customers. Offer the ability to help "distribute" content for indie producers. They pay a fee (probably more than those that just get the higher quality stuff), and they get content featured on pages, more options for uploading, and other goodies. YouTube could even offer a service where producers can have made-to-order DVDs of their work for purchase by regular users. YouTube and the producers would split the profits.

    It would cost about $2 to make a custom DVD and package of something an hour or two hours long. Sell it for $5-$10 + S&H, and there you go.

    They could get started by allowing uploaders to "share" their stuff, and a regular user could pick clips adding up to, say, an hours worth and pay $10 total for a DVD of all that. You would have an issue with people uploading shows and what not, but they would be able to either hire people full time to police copyrighted stuff or have a volunteer network, where the volunteers get free DVDs/free upgraded accounts for helping to report copyrighted stuff.

    A lot of sites are already heading this way. LiveJournal has a pay service. You get a bunch of extra features, but mainly it's more of the same. MySpace will probably start locking some features behind a pay barrier, like streaming music, if ads don't make enough.

    Some sites, like general news sites or just general all around sites will meet some problems with this, but they will just do this in bits and pieces rather than the entire site (Yahoo! and MSN have already started on this path, and I wouldn't be surprised if Google starts charging for some new extra goodies).

    The way of the web, most media, will eventually decrease advertising as people are able to pick and choose what they want instead of being forced into packages.


    Slashdot's own pay-for service is another example of the trend, though the features you get with it are lacking. (Sorry, guys, but seeing a dupe a bit eariler than someone else, removing ads, and getting a nice * next to my name is not really worth the money.)
    • The way of the web, most media, will eventually decrease advertising as people are able to pick and choose what they want instead of being forced into packages.

      I'm not so sure of that -- it's just more efficient (and therefore cheaper) to force customers into packages, even when trying to please as many as possible. Plus, you get additional revenue from forcing people to buy an expensive package just to get the small subset of content that they really want. This has held true for cable (even with competit

  • by carpeweb (949895) on Friday September 08, 2006 @12:22PM (#16067013) Journal
    Reminds me of the dot com boom.

    You remember, right? Back in the days when you didn't need a business plan?

    If YouTube hasn't already answered all these questions, then it truly learned nothing from the bust.
    • Re: (Score:3, Interesting)

      by kthejoker (931838)
      The flip side to this, though (and it's an uncanny idea) is that if YouTube didn't do it, *someone would*.

      It is simply a desired niche of the Internet to have video clips of all varieties easily available for searching, posting, and referencing.

      And ultimately there's no business model to support this. The SOLUTION is to subsidize this service with another service. It can be video-related (charge content producers for placement, or charge users for higher quality), or it can be otherwise (Google Video subsid
      • by carpeweb (949895)
        ultimately there's no business model to support this

        Well, you suggest one in your very next sentence (cross-subsidy).

        I would be verrrrry interested in acquiring YouTube to complement my actual moneymaking ventures

        Complement is exactly the right word. Money-losing definitely complements money-making. Are you seriously suggesting that someone can "make it up on the volume"?

        the ultimate point is that whether or not YouTube has a viable *business* model is not relevant

        I can't think of anything
    • by timeOday (582209)
      Not really. Pets.com and that online grocery place had real expenses (and not just their superbowl ads). Youtube is different. Bandwidth is cheap and getting cheaper every day, and other than that the site is mostly automated. Youtube did not start with a huge outlay of VC funding, either... it started small and just took off in popularity with users. I don't think they'll have much trouble supporting it with ads.
      • by carpeweb (949895)
        I didn't mean to imply that YouTube was following all the excesses of the dot-com boom. I was just observing that no one seems to care whether they had a plan for revenue or if they just figured they could "grow their way to profitability". Last time I analyzed that proposition, you needed a revenue model, which seems almost too obvious to mention as an essential part of a business plan. Maybe YouTube has this all figured in its plans. But the discussion up to the point where I made my OP seemed very
    • Back in the days when you didn't need a business plan?

      YouTube is in a very different situation. The failures in the dot com gold rush were speculative web site concepts. "If we build this type of site, maybe we'll get a kabillion visitors and from there, we can do XYZ to make money from the traffic." People were investing in the possibility of these schemes being successful at attracting traffic.

      YouTube has already crossed the traffic hurdle. They've built amazing brand awareness with NO ADVERTISING
      • by carpeweb (949895)
        OK, I agree that YouTube hasn't done everything that the dot-com idiots did.

        But it sure sounds speculative to build "amazing brand awareness" without a plan for what to do with it.

        Incidentally, I'm not saying that's what YouTube has done. I'm just saying that if they've done all this without a plan, then they're idiots. The OP seemed to imply that YouTube has built this amazingly huge venture only to ask, gee, how do we get revenue to pay for all this?
  • There are pirated TV/movies and other copyrighted stuff on it - which draws lawsuits and alike. But unlike Kazaa, YouTube does not depend on those to be kept alive - there are SO MUCH users created content it's not even funny. And I'll bet at least half of the use are for those purposes. At least for me, all the links I got from others in YouTube are all users created content.
  • Most "commercials" are boring and pointless, and just focus on "you need this product!"

    If companies would make good, entertaining videos that people would actually want to watch, then they would have a perfect place on Youtube. They'd spread throughout the internet via e-mail and message boards and would be great exposure for the product just like any other viral video.

    The advertising firms just have to get more creative...
  • by KalvinB (205500) on Friday September 08, 2006 @12:30PM (#16067076) Homepage
    Let's see, go bankrupt or alienate some visitors.

    Unless it's worth going bankrupt over and having a heck of a time getting financed for the next project, I'd say it's not a hard decision to risk losing some visitors in order to not go bankrupt. It's pretty pathetic when owners of a large site believe in the bandwidth fairy and fail to recognize they're the fairy. They're the ones paying for it.

    It's time to either start putting some limits in place to get costs below revenue or to raise revenue. And if some visitors can't deal with it, then good riddence to them. You don't need a bunch of leechers driving you into bankruptsy. They obviously don't care about you so why worry about them?
  • it's cost, not ideas (Score:3, Informative)

    by oohshiny (998054) on Friday September 08, 2006 @12:32PM (#16067091)
    People often assume that something like YouTube, Palm, Tivo or whatever becomes big because someone had a unique insight. But, more commonly, it's simple cost and demand. Palm succeeded because chips and displays had gotten cheap enough to build a usable handheld. Tivo succeeded because harddisks and compression hardware had become cheap enough. For YouTube, bandwidth had become cheap enough to allow putting lots of video on-line and distributing it toe end users.

    However, even if things have become cheap enough to start a business, they may still not be quite cheap enough to sustain it; if YouTube needs to make more in revenue than delivering video content costs them, and it's not clear that they can. And whether they can depends less on any brilliant insights they may have, and more on consumer behavior, ad revenues, broadband availability, and bandwidth costs.
  • And moving to whatever it is that Google Video uses. (I believe its just a simple embed tag or whatever it is that pulls in the video file directly)
    • Re: (Score:3, Interesting)

      by protohiro1 (590732)
      Google video does the same thing. Flash video actually rocks. Great compression, fast reliable player and widely supported (requires flash player 7). Flash video player is pretty much everything that realplayer et al aren't. And the fact is there isn't a good, open embedded movie format yet.
  • Theres not many videos on youtube I'd pay to view, and ads would certainly wind me up big time, but if they charged me say $20 a year for unlimited site access, I'd happily pay up, I get $20 worth of laughs just from watching TV bloopers.
    This assumption that ads will save all web companies is flawed. the existance of technology like adblock renders it useless in some cases, and there are only so many advertising dollars to go around.
    If subscription doesnt work, then paying to be the top video in categories
  • There are already a ton of commercials in the YouTube content already. They just have to figure out how to tap into that. Companies are already getting free advertising when their funny/stupid ad gets uploaded and has hundreds of thousands of views in a few days.

    I've got it. They should send a letter to the ad agency or product company explaining that their ad is being watched by viewers without them having paid YouTube for showing it. They can threaten litigation or to delete the ad unless they pay to supp
  • by ScrewMaster (602015) on Friday September 08, 2006 @12:49PM (#16067214)
    In the pilot for the old Max Headroom series, Network 23 pioneered a new type of advertising called "blipverts", fast, tightly-compressed burst of audio-visual information designed to prevent viewers from switching channels. Unfortunately, they had the side effect of making their "perpetual, more slothful viewers literally explode" but a similar idea could work here. YouTube doesn't have the advantage of conventional television, where people are watching a minimum 30 minute show, and will sit through a 30 second commercial spot in order to get back to what they really want. YouTube is offering what are essentially extremely short TV shows as their primary product with no real possibility of a commercial interlude. On the other hand, a two second advertisement presented at the beginning, if entertaining (or startling) enough, might be very effective yet not turn viewers off to the service itself.

    Heck, if they want this to really work they should offer a plan that would reward submitters for presenting typical YouTube videos formatted as advertising for specific products. Those videos could then be shown to advertisers, who could pay to have the ones they like presented to regular YouTube viewers as advertising.
  • by Ynsats (922697) on Friday September 08, 2006 @12:58PM (#16067284)
    They are not the only way to garner revenue from a site. Look at eBay. It costs me nothing to browse the marketplace there and if I want to bid, my account is free. If I want to sell my wares there, it'll cost me. However, because of those fees, eBay's ads are not intrusive and barely noticable.

    The whole allure to YouTube is the fact that it's free to watch. I REALLY can't stand going to a site to watch some linked video only to have to sit and wait for the ad to load first and then I have to wait for the ad to finish playing and then I still have to wait for the video I went there to see to finish loading. I'll click out of that browser window before the ad even finishes playing. It's a waste of time. What is even more infuriating is depending on server load, it can take forever to load that ad because that same ad is being loaded by millions of computers all trying to view different videos.

    That is what kills these sites, these excessive ads and membership fees. I think eBay has one of the best revenue generating models out there. Whether they are profitable or not is in the hands of thier management. I think that if YouTube wants to stay on top of the game yet be attractive enough to get investors to infuse capital then they need to start looking at a fee based system subsidized by ads and maybe a premium, fee based viewer service.

    Charging the average viewer to see an amateur video that quite possibly will suck more wind than a Hoover is a sure fire way to piss off your viewers. Bombarding them with ads just to make them wait and surf through the crap only to view that same amateur crap mentioned above will also alienate them. After all, most of us could live a full and healthy life without ever viewing little Jimmy's guitar rif video on YouTube. However, little Jimmy might just be dashed in his dreams of being a guitar hero if he can't get his video out on the internet. So charging the viewers who don't have the necessity to see the video will not work. They won't be as willing to pay for something they don't need. For that kind of pricing to work, you actually need a commodity that people want. I'm not going to pay to watch someone else's crap. If it's free for me to watch, I will gladly go for the lark. However, if I have a video that I just gotta have out there and YouTube is my place of choice to host it then charge me out the wazoo to get it up there. After all, that perceived need to gain acceptance of my internet based peers who will view my video comes pretty damn close to making hosting services for my video a commodity. Therefore flat fee pricing would work there.

    Now if YouTube has issues with excessive bandwidth and offensive things being posted then, charging a nominal fee to post the videos will help squash those problems. It will help because people will be less likely to waste thier money posting crap and then linking to it from many other sites. The viewership will not likely drop off in that respect but might actually pick up because like what was said above about quality vs. massive content, you will gain viewers looking for quality viewing and not just massive amounts of content.
  • Why is the chant always, "ads ads ads"? If millions of people love the site then it should be possible to work out a subscription model that works. Look at livejournal for an example of a tiered functional subscription model.

    Advertising is not the only way to run a business in the modern world.
  • Has anyone ever seen that frontpage? I usually only click the links sent to me.
  • Bill Gates, who may be planning his own video hosting service

    I'm not too sure I want to see any of Bill Gates's own videos, thanks very much ...

    Rich.

  • With all due respect to YouTube, I think that MySpace is the site that's more analogous to cancer.
  • How many people have intentionally downloaded commercials?

    I know I have.

    If advertisers would be a little smarter about their advertising, and make their advertising work for the consumer, we wouldn't be so annoyed with commercials being crammed down our throats.

    Commercials need to be funny, or perhaps provide you with a url to print a coupon for a product (that'd work online really well), or something. If commercials weren't so bloody annoying, things would be so much better.

    Many commercials have annoyed m
  • by coldtone (98189) on Friday September 08, 2006 @02:14PM (#16067878)
    With the number of page views they get, adsense is already paying them close to 2 mill a month.

    http://plentyoffish.wordpress.com/2006/08/24/youtu be-is-already-wildly-profitable/ [wordpress.com]
    • Re: (Score:3, Insightful)

      by ImaNihilist (889325)
      And that's probably what it costs them per month in hardware and bandwidth ALONE, if even.

      Given the current model, YouTube will *never* be profitable. And if somehow, by magic they become profitable, the movie and television studios will instantly start pilling on the law suits. The reason no one has sued YouTube yet is because everyone's hoping they will become profitable, just so they can sue them. I wouldn't be suprised if the MPAA and major TV studios have STACKS of paperwork ready to be filed against Y
      • by Stalyn (662)
        The Grokster case sets a precedent in that if a service does not take action to remove copyrighted material it can be held liable. YouTube does remove copyrighted material when asked and also does things to hamper copyright infringement (limits videos to 10 minutes).

        Sure there is plenty of copyrighted material but YouTube has never denied a request to remove such material. Also the majority of copyrighted content comes in clip form, like a 3 minute clip of a television show. It's not far fetched to imagine
        • It's borderline legal. Production studios make a big deal over EVERYTHING. The only reason they haven't raised their amry of corporate lawyers is because there's no money in it...yet.

          You better believe that if YouTube moves to a subscription model, where people are now paying YouTube to watch their movies that they are going to raise all hell. And on the flip side, that's why YouTube likely hasn't gone with a subscription model. It's lose-lose for YouTube. Eventually the debt will just become so large it wi
  • Distributed Network (Score:2, Interesting)

    by Overphiend (227888)
    It would seem that if bandwidth is an issue, why not offload the bandwidth to the users? Distributed networking and file sharing has been around for a while now, a service like youtube could benefit greatly with a customized version of it. Instead of having the users get the movies directly from the site, use a distributed system similar to or even built upon bittorrent.
  • One thing I notice is a lot of users post their favorite music videos.
    In fact, when I get the urge to see a video from a favorite band, i search youtube rather than turn on mtv (since mtv doesnt even seem to play videos anymore)
    I think it should be easy enought for them to approach the music industry and have them pay to feature music videos on the site.

    allowing yourself to avoid paying for the bandwidth of hosting a lot of videos on your website.
    If there was a way to have embeded videos play ads, b
  • forget youtube (Score:3, Informative)

    by clambake (37702) on Friday September 08, 2006 @03:24PM (#16068354) Homepage
    There are tons of smaller sites that are a hellofa lot more firendly. My favorite so far is Go Fish [gofish.com].
  • by meburke (736645) on Friday September 08, 2006 @03:41PM (#16068479)
    Last night on the local 1/2 hour news show there were 12.5 minutes of ads. Occasionally I tune in to a show like "CSI" or "Grey's Anatomy" and tune out about the second round of commercials. I can tolerate 2 or 3 ads, but 7-10? No Way! The content has to be exceptionally good for me to watch a commercial program these days. I think "Dancing with the Stars" may qualify, but they don't seem to have as many ads.

    I never go to Yahoo! Music to watch videos anymore either, because I have to put up with the ads first. I want to select a bunch of videos, usually the same type (Jazz, Pop, etc.), without having my entertainment interrupted by ads.

    The person who figures out the balance formula for paying for services with innocuous, acceptable advertising is going to make millions of people happy and become rich at the same time.
  • by Guspaz (556486) on Friday September 08, 2006 @08:11PM (#16069883)
    There is one benefit of growing. The larger you get, the lower infrastructure costs get per-user. The more bandwidth you order from a single provider, the better per-megabit costs they'll give you (You can bet they'll give somebody leasing a 10 GigE connection a way better deal than someone leasing a 100mbit FastE connection). The same applies to hardware, the larger your data storage requirements, the cheaper it gets. You can start taking advantage of things like Sun's 48-drive fileserver.

    Yes, the "rule" applies less to hardware than bandwidth, but in general, the more money you've got to work with, the more you get for each dollar.

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