YouTube Growing ... Like Cancer? 174
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."
Content, ads, legal, pay to play (Score:5, Insightful)
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.
The emperor has no clothes (Score:5, Insightful)
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.
Alienate users with adds? don't think so (Score:3, Insightful)
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.
Re:Content, ads, legal, pay to play (Score:5, Insightful)
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:Content, ads, legal, pay to play (Score:3, Insightful)
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 as few visitors as possible.
Re:Content, ads, legal, pay to play (Score:2, Insightful)
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 actually *keeps* you from looking at the content you want, actively takes away your time and can't be ignored (and probably not blocked without blocking the actual video, either). In other words, it'd be far more annoying and intrusive than the ads on the websites you mentioned.
Sharing clips should be fair use (Score:4, Insightful)
Party Like It's 1999 (Score:3, Insightful)
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:The emperor has no clothes (Score:3, Insightful)
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 zero air-fees. Thus, the prospect of litigation becomes less of a risk, even if it is still quite preesent.
This may not be what most people do, but I don't think saying that YouTube "has survived off of its own lawlessness" is correct. It has survived because of its reliable flash player and sheer volume of fresh content, both original and copyrighted.
Re:The simplest way for them to make money (Score:3, Insightful)
Re:Alienate users with adds? don't think so (Score:5, Insightful)
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.
Why do we always look at ads and memberships? (Score:4, Insightful)
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.
Re:Content, ads, legal, pay to play (Score:5, Insightful)
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.
If only advertisers would learn... (Score:2, Insightful)
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 me to the point that I boycott the product. Old Navy commercials are a great example. They're not entertaining, they're irritating. Whether its annoying jingles, bad actors, etc.
Yes, I realise you can't please everyone, but most commercials nowadays aren't pleasing anyone.
I, for one, know I wouldn't be bothered so much if commercials were just a little bit entertaining. I love the commercials Bell is currently running here using the two beavers. I intentionally watch those commercials when they come on because they're funny.
If company execs stop hiring idiots to do commercials, and make good, entertaining and/or informative, actually useful commercials, and put 5-10 second clips on the beginning of youtube movies, I'd happily sit through them. Alternatively, they could do as they said, and sell space on their main page for movies put there by advertisers. If they're actually entertaining, they will get watched.
Advertising, imnsho, isn't the evil, horrible thing, most of us make it out to be. Of course there's a limit on its obtrusiveness, but if they make good commercials targeted at the kind of people they're trying to sell to, then people wouldn't get so pissed off with them.
Going to show a video about a car? Run a BMW commercial before it.
Going to show a video about some guy opening a beer bottle using only a piece of paper? Show a beer commercial before it.
Just don't make them suck.
Already Profitable? (Score:5, Insightful)
http://plentyoffish.wordpress.com/2006/08/24/yout
Re:Already Profitable? (Score:3, Insightful)
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 YouTube for copyright infringement. If the day ever comes when YouTube says, "Hey, we just made our first dollar," that's the day that YouTube gets shut down because of the thousands of cease and desist orders on their doorstep.
YouTube is a perfect example of a dot com site that will eventually go bust. It's just a matter of time.