The Evolution of YouTube

picture-33TechCrunch reports that Google is going to allow media companies to sell their own ads against their own content distributed via YouTube. The post takes the position that this will help generate greater revenues on the site.

While that’s certainly true, I believe the real ambition of such a program is to encourage more media companies to put their content on the site legally. YouTube has always been about “the head” as well as so-called tail content (user-generated). If there were no “professional content” on the site it would lose value and interest over time. Indeed, Google has watched Hulu’s rise and seen that it must be able to offer more than lip sync videos and children being silly (etc.) — to oversimplify. People are curious and interested in that content of course, but they also want  the higher quality professionally produced content. 

In my mind this move is partly about appeasement, but it’s also about YouTube’s evolution into a more full-blown and complete video service that offers movies and TV shows, as well as other types of premium content (and video downloads). And the migration of YouTube to the living room (via set-top boxes and direct integration into TVs) is consistent with what I believe to be that longer-term strategy. Consider YouTube as a potential substitute for cable TV. While that will likely never happen it’s not entirely far-fetched. 

Another part of YouTube’s long-term strategy may be to simultaneously evolve the site into a broad-based search engine that offers video content instead of text — again in anticipation of “the Internet in the living room.”  It’s already the second biggest search engine in the US after Google itself, in terms of query volume. Along those lines, YouTube is reportedly expanding its e-commerce “click to buy” program. Certainly this is about revenue as well. But again I believe it’s about broadening YouTube’s content and utility.  

YouTube now offers lots of information and videos about products, service businesses/SMBs and other “commercial” content that people generally don’t think about when they’re on YouTube. This is why I’ve argued that 10,000 SMB videos on YouTube doesn’t make lots of difference right now for AT&T or for YouTube. People typically aren’t doing yellow pages searches on YouTube — but one day they may be. They may also be searching for products, product reviews or travel options, etc. That becomes even more compelling if you’re watching YouTube on a TV screen in your living room. 

The move to HD on YouTube also anticipates that day as well.

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Related: The WSJ reports on a collective agency/media company effort to test and optimize online video-ad formats:

The recession is making for some strange ad fellows. Media companies including Microsoft,YahooCBS‘s CBS Interactive and Hulu.com are joining forces to attract more money to the fledgling online-video advertising marketplace by testing ad formats.

The project, dubbed “the Pool,” is the brainchild of Publicis Groupe’s Starcom MediaVest, which buys roughly $16 billion in U.S. ad time and space annually for big advertisers likeProcter & Gamble.

Starcom MediaVest and sister agency VivaKi say they are trying to create standards in the online-video market, which is popular with consumers but hasn’t turned into a serious money maker.

Of course these video formats and interactive ads will all be on “TV” one day as well.

5 Responses to “The Evolution of YouTube”

  1. MiriamEllis Says:

    Greg,
    Last night on YouTube, I was served up a screenwide, banner-sized promotional video for a movie across the top of the whole page. I had never seen this before. Have you?

    Miriam

  2. Greg Sterling Says:

    I have not — yet.

  3. Tim Cohn Says:

    Miriam I saw it the other day as well.

    I ignored it because it was black and looked like a horror movie trailer.

    I wonder if video banner blindness happens even on YouTube?

  4. Greg Sterling Says:

    I think that it does … Or will.

  5. Stever Says:

    After reading the CNN.money article about TurnHere’s SMB videos

    *oh look a quote from Greg at the bottom http://money.cnn.com/2009/01/21/smallbusiness/turnhere_ads.fsb/

    and this discussion today on Webmaster world http://www.webmasterworld.com/google/3832621.htm

    it is certainly heading that way. But i think only up to a point. I’m not sure about people searching for a local small business using YouTube as a starting point?? Maybe for some.

    But video is still going to be a big thing for SMB’s. Embedding the YouTube vids into their websites, on the YP sites, etc. can only help. Some will produce something weird and unique that could go viral, most will be rather plain jane, but still good for the small biz.

    And maybe enough people will start their search in YouTube, maybe enough to matter. If not, video is still a good thing.

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