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Monday, May 14, 2007

Why YouTube Needs to Share the Revenues with Everyone

Lots has been written in the past week about how YouTube will integrate advertising into its videos, and start sharing the revenues with some of its more established indie content producers:

- and NewTeeVee have screenshots showing you what it looks like

- Mark Cuban weighs in

- BusinessWeek and the Wall Street Journal talk about how content producers will get attention and get paid. Michael Totty writes:

    It turns out that success in the new-media world depends on a lot of the same things as in the old-media universe. Just as in Hollywood, becoming a hit takes talent, effort, timing and some luck. Sex appeal is just as valuable online as off. And getting noticed by the "mainstream" press also helps build buzz.

    Most important, though, is the way Internet stars exploit the power of the Web. They employ all the social-networking tools available on new-media sites like Google Inc.'s YouTube, inviting fans to comment on their work, link to it and even copy it. And they draw on email, subscriptions and other tools to alert fans about new offerings.

    "The most popular are the ones who have really tapped into the social fabric" of the Internet, says Jamie Byrne, head of product marketing at YouTube.

- Finally, there's this take from a "former YouTube star," which accuses YouTube of trying to establish itself as a new gatekeeper, providing access to as much exclusive content as possible.

My observation: YouTube is smart to try integrating advertising into some of its videos to see how users (and content producers react). But if the site doesn't open up its advertising program to all content creators before the end of 2007, or set a threshhold (IE, once you've hit 100,000 views, you can start earning money), I think they're going to end up being seen as elitist: the message will be that only content producers who've already built a following - the A list - can make money from their work.

(Incidentally, I noticed recently that the Google search engine has completely de-listed CinemaTech. Coincidentally, this happened around the time of some reporting I did on CinemaTech and in Variety about YouTube's plans to integrate advertising. Let's just say that YouTube wasn't keen on having this topic covered in advance of its official announcement. Is this the sting of GooTube retribution?)



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