Man that headline will sell. Truth is, I am very careful about NOT revealing confidential information on this blog that I learn from Google employees, as a YouTube partner, or through my conversations with industry colleagues or creators.

But most of this is public now, or based on educated assumptions topped with a saucy tabloid-like flare. On a similar note, YouTube’s Business Blog published a refreshingly transparent POV about some YouTube myths recently. Did you know that 70% of Ad Age top 100 marketers ran YouTube campaigns in 2008?

Here are the secrets the YouTube PR folks won’t reveal:

"I've got a secret" -Cindy Brady

1) YouTube is Monetizing Fewer than 9 Percent of Its Videos. But Who Cares? Kudos to Jason Kincaid for doing fancy math to figure out what percent of videos YouTube is monetizing (meaning the site is making money instead of paying to stream and bleeding money). The answer was 8.5%, which is close to AdAge’s 8.7% estimate (CNN Money claims 13%). Of course, monetizing could mean shitty lil’ penny banner buys, decent InVideo sponsorships, homepage takeovers, or premium rev-share deals. It’s long been rumored to be 3-5 percent monetization, but let’s get real. Google could turn that number to 100% by simply running Adsense indescriminately on each page. So I’d be less concerned about the percent than the profitability.

Thanks to YouTube my videos are seen 200-250,000 times a day (yey, Uncle Google). That wouldn’t happen any other way, and I’m only hoping the biz-dev folks enhance the average profit per-monetized video before it bothers chasing the impossible-to-monetize-well long tail. This is happening as we speak with new revenue boosting options.

If I got a penny per view, I’d earn $730,000.00 this year. I’m not, mkay?

2) Algorithms Squashed the Editors. Almost nothing you see on YouTube is by accident… or an editor anymore. While YouTube editors once possessed more power than most network executives (creating instant celebrities by homepage feature pixie dust), the model is now driven almost exclusively by relevancy and economics. Recently, YouTube announced content creators and small advertisers can get their videos promoted for a fee… and not just against search results. Editors continue to serve some role on the “spotlight” pages and community relations, but are not the Titans they were in 2006 and 2007. That said, we still love them deeply because our love was unrequited. Especially when they put us on Partner showcase pages.

Google-Data Robots Eat YouTube Editors' Brains for Fuel

3) YouTube Still Plays Favorite, and especially for “TV Shows.” Lately, YouTube has worked hard to pimp its “shows,” a collection of retro TV that lost its charm faster than Bazooka loses its taste. Ba-boom. There also are some YouTube partners that live on the home-page (CommunityChannel), the recommendation section for new registrants to YouTube, or are “micro-featured” everywhere. We don’t know whether the editors are doing this, or the algorithms are saying: “these guys are good YouTube-addiction starter drugs.” But we do know that if a human does have any input to this “favoritism,” the person is probably really smart, attractive and has good breath. Man I’d like to meet ‘em!

4) It’s All About Your Relatives: Not Keywords and Viral. Think viral-views is the engine behind YouTube? Wrong. It’s about having a steady daily audience (like many, but not all, of the top 100 most-subscribed) and having your videos appear as a related video to popular videos… in other words, via ad, editor or algorythm, getting next to watched videos. Just like being next to a pretty girl makes you look cooler.

A visit to YouTube is often a chain reaction. You start to watch one video, and several related videos draw you deeper. Metacafe was once the master of this, and now YouTube is drawing upon its data-oriented parent, Google, to facilitate what I call the “video roach motel” model. This will get better with time, as we move from “title, tag, description” as being the view driver, to that mystical thing called “relevancy.”

What’s relevancy? I’ll give you two examples: if someone searching Google returns instantly after clicking on a result, that page is penalized on the rankings. Presumably it wasn’t what the searcher wanted. On YouTube, if a video is poorly rated and/or is viewed for a percentage that’s far below average for its total duration, it will eventually be penalized. Example two: on Amazon, there’s a high correlation between Wayne Dyer and Dr. Seuss book purchases, then those two books are related. The machine is getting smarter based on universal behaviors and your own preferences. Soon enough, my audience will be a smaller percent of YouTube but hopefully larger and more appropriate. That’s because we’ll see more of “people who like Shaycarl may also like Nalts.” (And although I may not be as funny or cute, I’ll look thinner to those viewers).

Neither of these models requires indexing the content, mind you. So in theory a video could be relevant to you without the algorithm even knowing what’s being spoken (remember years ago we thought all video would be transcribed to facilitate SEO… and that we’d be driving space cars by now?).

5) YouTube May Not be Hurting, But it’s Hungry. Google was the first to abandon banners and move entirely to a bid model. But YouTube, in a Yahoo-like move, has blitzed in past few months with homepage takeovers. Folks, there’s no reason for ads to represent 50% of the site’s homepage (above the fold) unless you’re trying to show fast revenue. It’s not Googlesque (even if CNN Money maintains that Google hearts YouTube). Of course the rice-sized brained media buyers are using this precious space to simply drive awareness instead of engagement: most of the homepage takeovers are for films, and there’s usually nothing more than a trailer to compel interaction.

CNN Money suggests all is zen-like between YouTube and Google. Hey, even if YouTube captured as much as 1 billion in annual revenue, that’s 1/30th of what Google does. Meh. So if YouTube bleeds a few hundred million to run itself ($83-$350 million in infrastructure/hosting alone, and — who knows — $250 million to maybe $500 million in a year), who cares as long as it has strategic long-term value?  Online video is white hot, and it’s just a matter of expediting the future and reducing the blood loss. Of course, all of this is speculation, and Google/YouTube aint talking.

6) Why YouTube Can’t Discuss Real Profit/Loss. No, YouTube doesn’t want you knowing about its economics, but I have 3 words for the curious: stop asking, idiot. YouTube can’t over or understate financials, yet journalists whine about the company’s decision to not publish profitability (or even costs or revenue specifics). Imagine the channel conflicts disclosure would create! If it’s horrible, YouTube has dimished street credibility with media outlets, downstream distribution partners, and advertisers… not to mention shareholders. If it’s schweet, then it attracts copyright attorneys like watermelon at a picnic. But should YouTube reveal case study ROIs (with permission of advertisers) to legitimize the medium to marketers? Uh- yeah. Glad you asked. I give YouTube a D minus on this.

7) Steven Chen’s Latest Contribution. YouTube won’t likely be issuing press releases about Steven Chen, who has continued to vanish from the public light. But thankfully, Chen disintermediated his employer and shared his latest project — which includes a golf swing. Hey, he’s got billions in the bank. What would you do? Probably build a coffee bar. Or buy the car you’ve saved up for since 2005. For nostalgia, check out Chen when Google bought in.

Shit. This post took me hours of time I could have otherwise spent trying to, um, make money. At least there will be a few comments from the back row. Right?

hot off the press…

A YouTube for All of Us
As a community, we have come to count on each other to be entertained, challenged, and moved by what we watch and share on YouTube. We’ve been thinking a lot lately about how to make the collective YouTube experience even better, particularly on our most visited pages. Our goal is to help ensure that you’re viewing content that’s relevant to you, and not inadvertently coming across content that isn’t. Here are a few things we came up with:

* Stricter standard for mature content – While videos featuring pornographic images or sex acts are always removed from the site when they’re flagged, we’re tightening the standard for what is considered “sexually suggestive.” Videos with sexually suggestive (but not prohibited) content will be age-restricted, which means they’ll be available only to viewers who are 18 or older. To learn more about what constitutes “sexually suggestive” content, click here.

* Demotion of sexually suggestive content and profanity – Videos that are considered sexually suggestive, or that contain profanity, will be algorithmically demoted on our ‘Most Viewed,’ ‘Top Favorited,’ and other browse pages. The classification of these types of videos is based on a number of factors, including video content and descriptions. In testing, we’ve found that out of the thousands of videos on these pages, only several each day are automatically demoted for being too graphic or explicit. However, those videos are often the ones which end up being repeatedly flagged by the community as being inappropriate.

* Improved thumbnails – To make sure your thumbnail represents your video, your choices will now be selected algorithmically. You’ll still have three thumbnails to choose from, but they will no longer be auto-generated from the 25/50/75 points in the video index.

* More accurate video information – Our Community Guidelines have always prohibited folks from attempting to game view counts by entering misleading information in video descriptions, tags, titles, and other metadata. We remain serious about enforcing these rules. Remember, violations of these guidelines could result in removal of your video and repeated violations will lead to termination of your account.

The preservation and improvement of the YouTube experience is a responsibility we share. Let’s work together to ensure that the YouTube community continues to thrive as a positive place for all of us.

The YouTube Team

…

Brief Editorial:
by Zack Scott

1. Why should videos be demoted on profanity alone? Why not just hide them for people not logged in and are 18 or older?

2. Some of YouTube’s most popular stars…Bo Burnham, Charles Trippy, sXePhil, Chris Crocker, Mark Day, etc…(name as many as you want) all have used profanity.

3. The new thumbnail idea sucks. Now what if none of the thumbnails are good?

4. YouTube sometimes features videos with profanity.

—————–

OK, now I finally understand YouTube’s “Stricter standard for mature content”

“Videos that are considered sexually suggestive, or that contain profanity, will be algorithmically demoted on our ‘Most Viewed,’ ‘Top Favorited,’ and other browse pages.”

They must not like sXePhil.

Thanks Kevin for being such a charming and righteous guy!

You are truly one of the nicest and funniest people on the net and we or rather I don’t show enough appreciation for all you do to keep us entertained, out of trouble and off hard drugs, but you do! And most of all you are a stand up guy and it’s not said often enough, I don’t think. So thanks again for everything and I promises I will never hack into your blog again.

So Nation of Nalts pass the beer and give a cheer,
dig deep down to the bottom of your silly human hearts,
say something genuine, not too queer and not to smear
and please, oh, please be smart,
hold back the venom
hold back the onions
that gives you the urge to… beg for a mint.

Thanks to MCase (loyal WillVideoforfood reader) for pointing out Knol. This is Google’s answer to Ask.com or Wikipedia, where you can write about a subject and share in advertising revenue if anybody cares to read it (and is so bored by it that they click the text ads and stop).

Here’s my knol biography, and I’ve placed a few articles and my eBook inside. I’m not asking you to go rate them 5 stars, but I would like you to remember that Nalts introduced Knol to you (2 years from now, when the term “knolling” is as pervasive as “googling”).

A Knol (see site) is an “authoritative article about a specific topic.” Anyone can write one like Wikipedia (although you can’t edit them). And readers will decide if it’s authoritative or hog wash (like how we score eBay sellers and buyers).

Knoling solves a need — we uninformed humans want vetted, credible content.  Google helps us find it sometimes, but we still don’t have a scalable social network infrastructure for weeding out the accurate from the crap. And don’t talk to me about Squiddo, people. There are probably more people using Twitter right now, and the gap from early adopters to mainstream is wider than my ass has grown since I developed spondylolisthesis and a fractured sacrum… clearly caused by my day job (and not those pratfalls you make me do).  

Of course there’s got to be a “what’s in it for me” for subject-matter experts to knowledge share-  I wouldn’t have knoled my articles this morning just to be nice, or on the chance that these will get views more than my blog. I am chancing on some meager Google adsense revenue. Maybe it’s the next YouTube (which is non trivial) and maybe it’s the next Amazon affiliate program (which is non profitable for me anyway).

Now here’s the million dollar question. Will it Knol get us indexed better on Google? TechCrunch called this out back in December, and this move put Google further into the content business (which is like being the broker and seller in one). What cracks me up about this TechCrunch article is that it doesn’t point out a similar situation. It’s, um, called YouTube?

Knol It All (www.knolitall.com) is already squatted. Puns are the second-lowest form of humor (after sarcasm), though.

!

discuss!

Viacom Knows What You Did Last Summer.

Holy shit. According to this Wired article, a judge ruled yesterday (Wednesday, July 2, 2008) that Google will have to turn over every record of every video watched by YouTube users, including users’ names and IP addresses, to Viacom. The order also requires Google to turn over copies of all videos that it has taken down for any reason.

Viacom is suing Google for allowing clips of its copyright videos to appear on YouTube, and wants the data to prove that infringing material is more popular than user-created videos, which could be used to increase Google’s liability if it is found guilty of contributory infringement.

Google argued that turning over the data would invade its users’ privacy, but the judge’s ruling (see pdf of ruling) described that argument as “speculative” and ordered Google to turn over the logs on a set of four tera-byte hard drives. The Electronic Frontier Foundation has already reacted, calling the order a violation of the Video Privacy Protection act that “threatens to expose deeply private information.”

The judge, in fairness, denied Viacom’s request for:

1. YouTube’s source code, and the code for identifying repeat copyright infringement uploads
2. Copies of all videos marked private and Google’s advertising database schema
3. Chad Hurley and Steven Chen’s nuts on a silver platter
4. Viacom CEO Philippe Dauman’s son Philippe Douman Jr (who works for Google) taking over as CEO for YouTube.
5. The letter G removed from the alphabet.
6. The internet being turned off until said disputes are settled
7. A return to 1990 when big media had a profitable business model.
8. Perpetualy indemnification from taxes by Viacom, its employees and any individual or company selected by the Viacom board.
9. Eleven virgins for each Viacom senior executive.
10. Viacom Day to replace 4th of July holiday.

When I first discovered Yahoo! Answers, I rolled my eyes. Another futile attempt to facilitate the “knowledge sharing,” which historically provides lots of value for the recipient but little motivation for the subject-matter expert. It’s been the age-old problem of knowledge management within corporations, and part of the reason that Epinions and other companies have floundered. The stop gap was supposed to be some software that read your e-mails and documents and used keywords to identify you as an expert on a topic for peers (yeah- you’d love your co-workers to find you ranked number one for porn wisdom).

Yahoo! Answers has a whole point system, but they’re not exactly exchangeable for food stamps or beer. It struck me at first like an ego tool with little benefit to those of us that are packed full of wisdom and answers. Heh.

Then I discovered a secret to Yahoo! Answers. It’s an honest Google search-engine cheat. In other words, it can get you ranked highly on search results for a particular area. I can’t tell you how many times in the past months that my Google search has led me to information on Yahoo! Answers. And my WillVideoForFood referral sources show that people are coming to this blog via Yahoo Answers more and more… because people are using me as a source to answer online-video questions.

So now, as a Google ranking whore, I’m having fun answering random questions about online video. Here’s a YouTube section. Go ahead and post a question, folks.

The Viral Video Genius shall answer you. He wants not points or praise. He simply wants to be noticed by Mother Google, the Orb of All Knowledge. To feel the warmth of Her approving gaze. For if you find Nalts via Her gentle direction, then he does indeed exist.

Note: It’s nearly impossible to find other good sources to verify this technique because searches for Yahoo! Answers and Google Ranking are swarmed with other information. But watch your Google results when you ask a question, and you’ll start noticing Yahoo! Answers ranking well.

P.S. I spell checked this, you neurotic freaks.

Here’s an excerpt of a wonderful post on Cracked.com titled “YouTubers That Will Never Be Famous.” It’s an opportunity for me to “clear the air” about being a self-proclaimed “weblebrity” (which is, you see, rather distinct from being a celebrity). LONG post, here, folks but this one is jam-packed with delicious goodness.

The internet is a big place, but there can only be so many Tay Zondays and LonelyGirl15s. Not everyone can become a crossover internet celebrity, and behind every one of these superstars there are a thousand others just like them, posting video after video and hoping one of them sticks. The following users represent only a fraction of a percentage of the YouTube users currently clogging up the internet tubes with absolute garbage – if you can think of others that deserve to be shamed, feel free to add them in the comments below. Or don’t, actually – additional exposure will only encourage them.

Let’s start by explaining that securing weblebrity status facilitates all the dysfunction of being a real celebrity, but none of the perks. You see, you receive hundreds of messages a day from viewers critiquing your work (probably more than many movie stars). The positive comments give you false self esteem, and the negative ones crush you like a lemon wedge. Eventually you develop thick skin, stop posting, or decide to find your self worth in a more healthy place (like at the bottom of a nice glass of vodka stired by a Xanax).

But, friends, there are at least 5 perks:

1. We get constructive feedback about what people like and don’t like about our mindless short-form entertainment (so in theory we learn). People look forward to our stuff, and that’s encouraging. Remember that three years ago we bored dinner guests with our videos.
2. We have a lot of fun. Shooting videos, editing them, collaborating, meeting fellow creators.
3. Some of us actually get paid by YouTube based on a percent of the revenue it makes from selling ads around our garbage.
4. We don’t really clog up the Internet. You see, there’s plenty of bandwidth around. It’s kinda like saying someone is wasting your sunshine (there’s an unlimited supply last I checked). Your tan doesn’t come at my expense… unless I have to look at your digusting, peeling skin.
5. We don’t answer to anyone except our audiences. No producers to tell us to “dial it down,” or sponsors forcing awkward insertions. No “review team” or fear of cancellation.

Now let’s look at VisibleMode. Do I watch him daily? Nope. Does he watch me? Probably not, except when I happened to pick him for the YouTube Secret Santa (I sent him a mug so he could sell out like me).

VisibleMode is one of the top YouTubers in Canada, and Cracked.com’s pick for someone who won’t get famous. Obviously it would be even more interesting to see a Cracked.com list of the few YouTubers that actually might get famous (a harder list to write, and a shorter one).

So now I’ll get to my point, which Cracked might have overlooked. VisibleMode may not soon be in a b-grade film or even an extra in a television commercial. Heck even Michael Buckley (one of the fastest growing, and television-ready weblebrities) may fade like many stars. But VM tells me today he’s had 6,760,748 cummaltive views of his videos. If Google sold those InVideo ads surrounding his videos at $20 per thousand ($20 CPM is the list price), VisibleMode would have hypothetically taken a portion of more than $135,000 that advertisers would pay YouTube/Google. Let me say it again. Even if most of the ads weren’t sold, the CPM wasn’t $20, and VisibleMode only got a small portion, he’d be making decent take-home per month. Will it last? I’m the wrong guy to ask, because I would have bought Revver stock. But I’ll bet he’s enjoying the ride and not too worried about missing a red-carpet event in LA.

The sustainability of YouTube and weblebrities, of course, hinges on advertisers garnering an ROI on the ads that surround this content. They’re fairly targeted and hard to ignore. And they’re in the context of content you’ve chosen to view. So the branding benefit should be worthwhile (a cent or two an impression) even if the direct-response may underwhelm more transactional brands. 

So assuming marketers sell products (or believe they are) via YouTube promotion, the advertising revenue will flow. A shake-down of creators will naturally occur, but the audience of YouTube is growing in depth and frequency, and media consumption continues to fragment. There’s a volume of valuable ad inventory lurking in the long tail, folks…. so...

• Weblebrities might enjoy a decent side income without ever becoming “famous.”
• Viewers will have a greater selection of garbage to fit their unique tastes- some cheesy stuff blended with unique, unscripted and short entertainment.
• YouTube/Google will make some money as well-backed middleman. Heck maybe they’ll buy Cracked.com.
• Advertisers should enjoy a decent ROI in an emerging medium that’s bound to resemble future television buys more than current television ads will.

Nalts may or may not appear on SNL, but he’s having fun while this lasts. I just wish Cracked would have picked me for someone who’d never get famous. Hey- I know. I’ll do a sunburn video. Worked for ShayCarl.  

One of the factors that has limited the growth of online-video advertising is the production and traffic work. Mike Shields of Mediaweek reports that the Interactive Advertising Bureau this week introduced a set of guidelines to standartize online-video advertising and make the medium “easier for advertisers to buy.”

The new guidelines cover three basic forms of online video ad formats: linear ads — interruptive video spots which are typically of the pre-roll variety, non-linear ads — which include the increasingly popular ‘overlay’ ad units, and companion ads — bannerlike ads that appear alongside video as it plays on the Web.

The guidelines, writes Shields, are the product of work conducted by the IAB’s Digital Video Committee, which is composed of 145 leading media companies, including Google, Yahoo and Microsoft. “This is a historic day,” IAB president and CEO Randall Rothenberg said, likening the announcement to a similar set of landmark guidelines put in place for banner advertising in the late 1990s. IAB senior vp David Doty said he thinks leadership and marketing, predicted “seismic shifts” would occur in the online ad business as a result of their adoption.

So while the viewer in me isn’t too excited to see the new “interruptive video spots,” the creator and marketer in me looks forward to the possibility that this may unlock some of the potential of this medium.

In related news, tech writer Leah Messinger writes about other sites beyond YouTube that offer advertising models brands can consider.

Google fired the engineer who convinced Virgin Founder Richard Branson and Google Co-Founders Larry Page and Sergey Brin to participate in an elaborate hoax (see press release) inviting individuals to apply to live on a Mars colony sponsored by “Virgle.”

Wired Writer Loretta Hidalgo Whitesides called it the “funniest April Fool’s Day spoof I have seen.” Whitesides is the founder of a local chapter of the Family Circus Fan Club, and has California’s largest reported collection of Alf memorabilia.

David Scheyd, the 28-year-old Google engineer who conceived the gag last February was, yesterday, inexplicably dismissed from his position at Google — a job he held for 4 years. “Scheyd presented the Virgle idea with such passion that we really thought it would be funny,” said Melanie LaForge, a Google spokesperson.

“It was with great regret that we had to let Scheyd go. It became clear yesterday to both Google and Scheyd that the attempted gag was too obvious and failed to amuse even the most affable and simplest minds employed by our company — the NYC media sales teams.”

Scheyd declined to comment except through a written release, in which he attributed the prank’s failure not to its concept but its poor execution. “The poor video deliveries by Branson, as well as Page and Brin, brought a sad and creepy fakeness to what might have been a very funny and believable bit.”

Neither Google nor Scheyd’s spokesperson could confirm if Scheyd had any credentials prior to leading the blunder.

Georgetown Business Historian Professor William Lawler called it “corporate America’s least-funny practical joke by a landslide.”

The only thing less funny than the prank, said Lawler, was the discussion group thread that had such actual unfunny quotes as:

1. Maybe the cure for cancer and aids is on Mars.
2. Curing cancer and AIDS would no doubt be a wonderful thing, increasing the quality of life for many.
3. Consider, however, that once eradicated, there will be other things that crop up, things we didn’t foresee.
4. There are several Mars analog projects that have been underway for some time, testing and trying to make colonization of the red planet a possibility for humanity’s future.

Scheyd would not confirm rumors that he has been offered a writing job for YouTube comedian Sxephil.

P.S. I’ve just informed that April Fool’s is over, and I’m not supposed to tease people with fake stories. But the ImprovEverywhere guy told me April Fool’s is amateur day. So by writing a fake story on April 2, I’m communicating to you that I’m a pro.