Does Google Want to Control Internet Video? - Sharing the Wealth?
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Google and YouTube made another announcement about the same time that attracted some serious attention from those in the search community. Over the next few months, the two companies are going to introduce a system whereby those who upload videos to YouTube’s site will get to share advertising revenues. The details have not been worked out yet, but only those who actually own the copyright to the videos they upload will be eligible.
Share advertising revenues? Isn’t that putting the cart before the horse? YouTube doesn’t run pre-roll ads on its site. Well, more precisely, it doesn’t do that yet. Obviously Google has been looking at all the videos on YouTube’s site and realized that they’re ripe for the monetization. I have to agree with John Batelle, who pointed out in his blog that Google spun this story really well. “Instead of ‘YouTube to Run Ads,’ the headlines were ‘YouTube to Share Revenue With Creators.’ Well played, my man!”
Once again, I’d like to point out that Google and YouTube aren’t exactly entering virgin territory. Just look at Revver. It pairs videos uploaded to its site with advertisements, and splits the ad revenue both with the people who upload the video and the people who share it. And Revver isn’t the only site engaging in this business model.
The difference, though, is one of scale. Going to Alexa to compare Revver’s traffic to YouTube’s traffic turns up the fact that Revver ranks 2,734 in Alexa – and YouTube ranks fifth. I don’t know about you, but if I were an advertiser I’d take one look at that and know exactly where I’d want to invest my money.
The risk Google and YouTube are taking is that going to ads just might jeopardize all the lovely traffic that YouTube is currently attracting. At least one of YouTube’s co-founders seems to recognize that. Chad Hurley said they had resisted putting pre-roll ads on the site before because “we didn’t feel it was great way to build a community. We wanted to keep it pure.”
In fact, a recent poll conducted by Harris Interactive bluntly pointed up the hazards of becoming “impure.” The sample size was more than 2,000 adults, of which 363 were frequent YouTube visitors. More than three-quarters of the frequent YouTube visitors polled said they would visit the site less often if it started including video ads before every clip. Almost one-third said they would visit the site a lot less often.
So the trick, obviously, is to introduce the ads without alienating the community that YouTube has already built – a community that is used to seeing their videos now, without waiting for a pre-rolled ad. Hurley hinted that there would be several different types of ad spots, even ones that run as short as three seconds, but we will have to wait and see.
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