YouTube’s Financial Situation & Saucy Details from Viacom Suit

The New York Times “DealBook” blog revealed some saucy stuff based on the thousands of pages of court filings made as part of Viacom’s copyright infringement suit against YouTube.
  • Viacom employees had secretly uploaded videos from the company’s movies and shows even as they were complaining about copyright violations, as The New York Times reported. Zoing!
  • USAToday’s “Juicy Details piece” puts it like this: “Google cites a marketing executive at Viacom’s Paramount studio who said that clips posted to YouTube “should definitely not be associated with the studio — should appear as if a fan created and posted it.” To accomplish that, Google says that “Viacom employees have made special trips away from the company’s premises (to places like Kinko’s) to upload videos to YouTube from computers not traceable to Viacom.” Kinkos FTW.

Payouts earned from the YouTube sale, as detailed by All Things D. Chaching! That’s a whole lotta sheep.

  • $516 million to Sequoia Capital
  • $334 million to co-founder Chad Hurley
  • $301 million to co-founder Steve Chen

All Things D also pulls some revenue figures from YouTube’s inception in January 2005 through August 2006, the last month before the company sold itself.

  • It wasn’t until December 2005 that YouTube started pulling in revenue, and it wasn’t until August 2006 that the company turned a profit. (The company showed a 186 percent jump between July and August of 2006, to $2.5 million.)

Wired Magazine also had a lengthy story documenting YouTube’s past 5 years, but it’s not online… which I find really annoying. Basically YouTube isn’t bleeding anymore, but it’s not exactly a “cash cow,” as Wired states (clearly someone didn’t read the Wikipedia on cash cow before filing their piece). I’m so over Wired.

10 Predictions for Online-Video in 2010

I’m a bit late on my online-video predictions for 2010 (unless you count this December post). The landscape continues to change, and it seems the world has been slow to catch up with my 2008 and 2009 predictions. Heck I even made a video in 2006 predicting 2007.

Here’s what I’m seeing in Online Video for Twenty Ten. Don’t forget to read the predictions from December from many WVFF guests who be smarter then my.

  1. Continued web-to-television bridges. While we’re still far from a merge of cable, television and online-video, we’ve seen some interesting changes already. Roku, Netflix, AppleTV, and a few brave television manufacturers pre-embedding software and wireless access or Ethernet plugs. I’m going o once again bet on the lazy man’s alternative to setting up their own PC media player. I see a $199 device that allows us to access the Internet right from our televisions. It’s a small PC, a remote-controlled keyboard and mouse, and it plugs into any television via HDMI or even less progressive connections.
  2. More stars dive into online video. Ashton Kutcher, Felicia Day, Tom Green. These guys have embraced new media, and there’s a wild rush to Twitter. 2010 is the year that more stars put themselves on YouTube. Don’t believe me? Wired reports Kutcher IS the future of video. They won’t always “go viral” but their strong fan bases offline will propel them to the most-subscribed pages of YouTube, eclipsing many of the web purists.
  3. AOL, Microsoft, and Yahoo Catch Up. Ironically, the laggards are web portals and search engines that had a media bent a decade ago. Google leapfrogged them with YouTube. They can’t stand on the sidelines forever. Watch for these players cutting deals with larger players (cable, telecommunications, etc.) to establish their dominance. Since it’s almost impossible to battle YouTube directly, they’ll focus on partnerships with tech companies and premium content providers. The result may not be as popular, but it will command the attention of advertisers that like pro content and “safe” plays.
  4. Programming Not Sporadic. When I was posting daily, I didn’t realize how important that was. It kept my audience active, and ensured my recent videos got 50-100,000 views. In past months, I’ve posted unpredictably and as little as 10 times a month. The result? I’ve plateaued. Meanwhile the regular posters (Sxephil, WhatTheBuckShow, CharlesTrippy and ShayCarl) are souring. The creator community is learning about the vital need to post predictably. ZeFrank used to post at 1:00 daily. TheOnion was always updated online on Wednesday. If you’re not predictable, you’re forgotten. Many amateurs are hosting live shows once a week, and the crowds flock to see their favorite “stars” unplugged. Audiences like routines.
  5. Division of Audience Focus in Conferences and Publishing. In the early days of the Internet, attendees included marketers, tech folks, and about every other business function that thought the web was going to be more than a fad. Online-video conferences and publications have taken the same approach. Watch in 2010 as conferences and publishing focus on more concrete audiences. AdTech for advertisers. StreamingMedia for technology people. And other conferences for marketers or web-studio playas. These conferences are too frequent and too broad to serve any audience well.
  6. Niftier Audience Participation. We’re still doing little more than putting VHS tapes online. The power of Web 2.0 (or 4.0 or whatever the hell you want to call it) is the interactivity and the engagement it facilitates in storytelling. Sure we saw 2009 videos that took advantage of “annotations” to create “choose your own adventure” series. But watch as advertisers and content creators merge to create more robust engagement experiences built on video, but with lots of tools that create a deeper, immersive experience. SevenEcho is one company to watch.
  7. White Dwarfs and Luminous SuperGiants. The lifecycle of the average weblebrity is compressing, despite a handful of amateurs that have maintained a vibrant presence. In 2010 we’ll see some new talent and more popular talent fading. There are not many people that have the persistence and creativity to sustain a continued audience. There are “Gary Larsons” that burn bright but short. There are Charles Shulz’s that don’t stop until they die (or their lines become jagged like someone drawing on a motor boat).
  8. Advertisers Forced In. Every year we predict advertisers will finally embrace online video (but the spend levels are not proportionate to the audience reach). That pretty much HAS to change dramatically in 2010. Not enough impact on television’s fragmenting and depleting audiences. So even the most traditional and laziest media buyer will be forced by marketers to spend more and spend more wisely. Watch for more obnoxious takeovers on YouTube and other sites, but also some clever alternatives that get brands “inside” the content.
  9. There is No 9th Preduction. That’s because I have to go wake up the kids, and don’t have time.
  10. News, News, News. We have watched as “consumer generated media” has made its way to many televised news stories. Now that cell phones with video cameras are fairly common, we’ll see more of this. And that prediction I made years ago… a live broadcast from some crisis directly from a person’s cell phone? That’s happening in 2010 or I’ll stop predicting it. I promise.

Wired and Fast Company Writers Aren’t Very Funny

I like to eat cow testiclesWired Magazine writer Meghan Keane isn’t very funny at all. Neither is the author of the article she echoed by Fast Company Writer Carlye Adler.

You know what? I’ll save you the trouble of reading these sobering articles. Comedy sites aren’t attracting sufficient advertising online. Except for College Humor, which is niche enough and maintains an exclusivity period before dumping stuff on YouTube (hey, The Onion… wake up… why should I go out to dinner/theonion.com if I can have your steakat home/youtube?)

  • “Viewers may flock to funny videos on the Internet, but for advertisers it’s not always a laughing matter. The questionable content that so often accompanies user-generated video can cause problems for brands looking to broaden — not damage — their image.
  • Ricky Van Veen, CEO of College Humor, says “We’ve found that a lot of our pieces have gotten a second life on YouTube.” “In the world of infinite ad inventory, quantity doesn’t matter,” says Van Veen. “It’s a tough ad market – you really have to bend over backwards and do something special for advertisers.”

Listen, Meghan and Caryle (if those are your real names). My MBA marketing professor was an expert (that’s why he taught instead of basking in a $750K SVP job). And he used to say three things sell.

  1. Cows
  2. The word free
  3. And funny

Okay he didn’t say that at all. I made it up. But it needed some attribution to credentialize it. And the reality is that my marketing professor spent the entire semmester boasting about his big idea in his briefcase. Finally one day he opened the case and revealed “the future of polling.” It replaced clip board surveys for the people that chase you in front of supermarkets, and it looked like a giant calculator.

Excuse me a second. I have to go punch someone who’s not funny. There. I’m back and feel better. What was I saying?

Oh- The articles should highlight two important points (and maybe they did, but we scan): First, the reality is that people are looking for content THEY find funny. Not another humor humor website they forget about 10 minutes after they visit it (vloggerheads, cough cough). Second, keep the costs down. The monetization model is still an infant. She can’t afford to pay a mortgage yet, the poor dear.