Monday, January 29, 2007

YouTube Users Get Paid - Death Blow to Revver?

YouTube founder Chad Hurley is making waves for hinting that YouTube plans to share revenue with users - he made the statements at the World Economic Forum in Davos on Friday. Jeff Jarvis grabbed a video of Hurley’s comments and posted it, fittingly, to YouTube (also embedded below).
Hurley didn’t go into much detail, but he said that the system would be rolled out in a “couple of months”.
YouTube Mobile and other features are often rolled out way ahead of schedule, but the copyright system is late to arrive - so it’s hard to say whether that timescale will be met. Worryingly, the BBC says the system could include pre-roll ads (video ads before the clip). That would be supremely annoying, and completely undermine Google’s philosophy of relevant, unintrusive ads. That said, Hurley doesn’t make any mention of pre-roll ads in the clip. Until we get further information, I’m going to assume that they’ll simply pay a share of the AdSense revenue to the user, perhaps adding AdSense for Video later on. This would be good for Google, because it would get a large number of young users familiar with the AdSense system.
Hurley said that they didn’t want to base YouTube around a payment system from the start, and that makes sense - you wouldn’t want a community of users who are solely motivated by money. At launch time, they also lacked the soon-to-launch audio fingerprinting (aka copyright protection) technology that allows YouTube to assign ownership to a clip.
But the real significance of this is that rival sites have tried to differentiate themselves by paying users. We covered how
lonelygirl15 had started posting clips to Revver to monetize them, while Metacafe is paying users through a system called Producer Rewards and Break.com, Efoof, Flixya and Guba all have various revenue sharing schemes in place. What’s more, these services are already struggling against the might of YouTube - Revver lost two founders, and Guba lost its CEO and two executives. If YouTube can deliver a bigger audience, a better sense of community and a good revenue sharing platform, then many of these sites will be left for dead. First to go, in my estimation, would be Revver, which relies entirely on this revenue sharing. Revver could stay afloat if YouTube doesn’t immediately deploy ads in embedded players, but eventually this is bound to happen - perhaps Revver will sell before then.

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