Friday, April 17, 2009

Deal Brings TV Shows and Movies to YouTube

The future of online video is professional content and though You Tube is best known for user generated uploads, the money lies with advertising against branded content. Recognizing that need, You Tube has entered into partnerships with TV and movie studios, and the space that Hulu has found an important grasp. "The agreements with the studios, which include Sony, Lions Gate, MGM and others, are significant because YouTube dominates online video. Nearly two-thirds of all video views in the United States occur on YouTube, according to the measurement firm Nielsen. Last month the site had more than 90 million visitors, 10 times as many as the next biggest site, comScore said."

In addition, there is finally the recognition that broadband, like cable, requires multiple revenue streams to survive, advertising and subscription. Whether it takes the form of transactional or monthly, You Tube will likely follow the Apple iTune strategy of charging for downloads or streaming.

Despite this plan to seek more revenue sources, You Tube says it is not leaving its bread and butter, amateur videos; "In an interview, Eric E. Schmidt, Google’s chief executive, said that YouTube would continue to embrace content created by users, even if it was not easy to earn revenue from it, because that content was essential to the popularity of the site." As the leader in online video, Google and You Tube have the deep pockets and the knowledge of the marketplace; what will define their success in building synergy with other content partners. Perhaps one day we will see Google owning a broadcast/cable network.

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