Could YouTube be in Big Big Trouble? The official numbers on YouTube's dominance in the video sharing space are out. Online video as a whole attracted 75% of US Internet users according to ComScore (via Mashable) that watched 158 million minutes of online video in May. The average stream is about 2.5 minutes. 35% of users use YouTube and YouTube accounted for over 20% of the online video stream total. Wow.
And now the bad news. Dailymotion a large French video sharing site was ordered by French courts to pay $32,000 in damages to a French director (along with the producer and distributor) who's CLIPS were on the site. After the clips were uploaded did Dailymotion begin to use Audible Magic which is seemingly becoming the standard in detecting copywritten clips. But what does this mean? Is this the end of the DMCA as we know it? (As an aside the DMCA stands for the Digital Millennium Copyright Act, and basically says that a Web site has no jurisdiction over what its users do, hence YouTube has been claiming as one of its defenses against Viacom). Will YouTube have to give up its users private information if they are caught infringing? Were all those Zidane Mashups from last summer considered copyright infringed?
We saw earlier this year how Digg went down with users posting the HD encryption key on its site. Will YouTube users also contribute to the backlash by posting copyrighted clips, causing massive lawsuits against YouTube and its parent, Google? And while $32,000 is small change for Dailymotion the video in question were clips. Was this fine some type of relative measure?
Lots of questions here. We're digging to get to the bottom of this and what this means for the future of online video sharing. But we do know one thing. Video sharing no matter what is here to stay.
Commercials as Entertainment AdAge's AdReview talks about the Sonic commercials and the well executed jokes and humor in them. The Sonic commercials are an example of commercials that you might not want to fast forward just because they are actually entertaining. (If you TiVo everything, then you might not know that..) But as I've been saying for a while now, the 30 second commercial is dead. So what do you do?
ABC.com allows one advertiser to purchase the entire ad portion during its commercial breaks. It really pains me when I see the advertiser using that time poorly, meaning it simply shows the same non engaging commercial every single commercial break. However, Fidelity had an interesting ad where they asked you very simple questions and showed a simple animation based on your answer. And thus you could do the same with your commercials. Depending on the ad time (still 30 seconds), why not shoot a variety of different commercials that all wove together into one story line? Interruption advertising is no longer working. It could actually detract from the brand. However, we've all grown up watching commercials so we actually tolerate them. But our recollection is virtually zero. Don't think that commercials have to inform. Look at the buzz created by JJ Abrams new film tenatively titled Cloverfield. It didn't tell us anything about that film yet people are Googling and speculating about what it could be. Let the audience decide whether they are interested enough to find out more from the quick teaser that you give them. If we can make our commercial actually become water cooler talk we've done our jobs.
Lessons from Online Video Dotcomedy was reviewed today by Mashable. It's a Funny or Die wannabe that is ad supported by NBC. The difference with this is that there is no UGC here - all content that is posted is reviewed by NBC's editorial staff. So only the best clips make it on there. Will this model work? Well, at least we won't have to wade through that much stuff, but perhaps volume is still the way to go where people will find something that appeals to them.
What's interesting are some of the comments from the OMMA video conference as reported by PaidContent. Some of the highlights include:
Video Ads need to rely on visual rather than audio - most users have their sound turned off or low
CPMs are hitting $5-$15 for semi professional user generated content (Heavy.com calls this SPUG)
Greg Wilson from Red Bull Tiger - One other thing he doesn't want is product placement. "It's a crock. When someone holds up a bottle of Evian on TV, is anyone being fooled? Is anyone being enticed? It's only being done because we can't think of anything else to do."
So that's another week in the wild west of online video. It appears that more and more brands are turning toward branded entertainment, but the big issue is still search. How can we find videos that are relevant and interesting to us? Will these ads pop up? Some but not all. The sunglasses falling on my face video was sponsored by Ray Ban but for everyone of those there are many more viral ads that barely make their view count out of the 100's. Are those considered successful? What are the metrics here? Greg Wilson's comments take out product placement, but what are our alternatives other than sending someone over to sit next to you and talk about products. I think that technology has been maxed out here. After all, you can't control content, filmmakers will make whatever they want. How do we get this stuff paid for?
Video AdSense - Relevant Ads Remember Blinkx? It's the publicly traded video search site. Mashable reports that Blinkx will soon be offering an advertising network based on speech recognition. So whenever a certain keyword that advertisers bid on either shows up in Meta tags or within speech, the ad will be shown in pre, post, or mid-roll ads.
This is definitely an improvement from Revver's model of fitting an ad in (at the end) that users have to click. Relevance should improve the response that advertisers get. How well will it work? Well the service hasn't launched yet, but I'm going to preface my statements by saying that Blinkx's service is definitely something that we need in the online video space. YouTube is doing something similar but there is only so much information that you can mine from meta tags. With the ability to actually gage what someone is saying, you can really figure out what the content is. That'll really be of value to the entire food chain of users, content creators, and advertisers since more relevant ads will be served to users, content creators will make more money, and advertisers will be minimizing wasted eyeballs.
Great. Or is it? Again, I'm not sure how Blinkx's software will work, but context is everything. Let's say Apple wants to buy the phrase Apple Computer. So everytime Apple Computer is said an Apple ad should run. Well, I think that you can see where we might run into some problems. What if I have a video where a character says "Apple Computer sucks" or "Apple Computer is a piece of s--t" or worse yet "Shove that Apple computer up your..." you get where I'm going hopefully. So then the video that bashes Apple becomes financed by Apple. Probably not where Apple wants to spend its ad dollars. The problem with this model is still that we need some type of human intervention to determine the qualitative parts of the video. It's similar to MySpace problems where advertisers didn't want to purchase ads or even AdSense because they were not sure of the context of the page. Context is key and while keywords will help in relevancy and is a step in the right direction toward advertiser AI, we still have a while to go. In the meantime, good job Blinkx for taking us one step closer to free content and relevant commercials!
Video Roundup Babelgum launched over the weekend (Friday to be exact I think) with some mixed reviews. Babelgum is in competition directly with Joost for quality P2P delivery of content. Lacking content (although Babelgum has Spike Lee on his side), lack of social networking, and difficult interface are some of the problems that have been cited with for Babelgum. Well, Joost started somewhere too right? I think Joost has the high profile of its founders which led to some great content partnerships and if Babelgum can do the same....
One of the early pioneers in video revenue sharing is Revver. Unlike pure views count, like Metacafe, Revver shares revenue with content creators by sliding a clickable ad at the end of the video. If a viewer clicks on it, then they are brought to the company's website and everyone gets paid. Well, Mashable reports that CEO Steven Starr is exiting the company six months after its previous CEO left. What's happening at Revver? Perhaps people aren't ready yet to click on ads at the end of a video?
Eefoof relaunches as VuMe. Reviews came in as somewhat negative and I think the only differentiator of VuMe from other video sharing sites is that revenue is shared based on actual revenue instead of video views. We'll continue to watch what VuMe is doing in this already crowded space.
Finally, my friends at Four Eyed Monsters have placed their entire feature length film on YouTube. It's the first feature available on YouTube at a whopping 72 minutes. And my friends tell me it'll be available for a week, which could be steps toward YouTube protecting their content? (Or I guess someone could suck down the video and reupload in 7 10 minute clips?) The film is actually also a pioneer in this space with a real relationship being started and grown through podcasts and technology. Pretty cool.
52 percent of users take an action (learning more to purchasing)
News was number one, followed by weather, and then humor
Companion ads (static banners with video) were most effective
The results of this study are pretty interesting especially for those of you living in New York exposed to the branding campaign that NBC Uni is promoting (via bus shelters and phone booths) about how they are innovating beyond 30 seconds. I'm also very surprised about the high number of users that take action following a video ad. Personally if an ad is irrelevant to me (for example on ABC.com) I can't wait to "click to continue" as soon as my requisite 30 seconds are up. So this means that somehow, ad servers are serving up relevant ads. I'm not sure how since YouTube is barely rolling out there new ad serving product, but I'm curious if anyone out there knows what they are doing. Companion ads are kind of an obvious thing which is what ABC.com does. No brainer there. Content wise I'd also agree that news and weather are the most watched. And again this is fairly obvious. We live in a world of Long Tail entertainment and the only common thread that everyone on the planet shares is the passage of time. So keeping up with what's new and keeping up with how you should dress (if its cold or warm, not fashion) is pretty obvious.
Marketing wise what does this mean? Well our intuition is wrong but the study is a bit fuzzy as it mentions that results were taken from 1,422 online video users. Are they YouTube watchers or ABC.com watchers? A mixture of both? Joost users? After all ABC.com only has 30 second companion ads. Also the numbers are fairly small. And of course if you have to sit through 30 seconds you will have better recollection than if you sat through 15 seconds. So this result could be skewed.
The big (and best) part of the study is the high call to action provided by those surveyed. This shows that users are not only in there for a passive experience but have their fingers on the mouse button ready to click away. It's a great sign that we're ready for interative TV.
Video Video Everywhere
Everywhere I turn, every story I read, someone is getting funded in this online video space. Earlier in the week it was WallStrip's $5 million cash out. Previously it was Will Ferrell's company starting a comedy site. Today its Rooftop Comedy receiving $2.5 million from Azure Capital Partners to bring stand up comedians to the Internet. Again, no one wants to be deemed the "You Tube killer" as they do not accept user generated content. Instead they take on the rest of the content creators out there with somewhat professionally created content.
Great concept as comedy seems to be the one aspect that can be controlled in online video. The other is shock which usually comes from UGC. Prom Queen probably falls under suspense/thriller and I'm curious to see if there's any drop off from last month's reported numbers. However, as Mashable pointed out, Rooftop Comedy provides an outlet for comedians to get their funniness out there and they have links to the comedians own website. I mean, that's all well and good, but what's the business strategy? I'm smelling Web 1.0 e-commerce bubble where everyone would put a storefront on no matter how much money they lost (Pets.com anyone?). Now there's a Web 2.0 online video bubble where we can simply place a niche targeted website up that plays back some content. Are we really going to serve up that many banner ads? Are people really going to click on your AdSense that's next to the video?
I think that the real winners are going to be the TV Guides in this new world. Is it Blinkx (which IPO'd overseas by the way)? Is there a way for us to find the content we want online? In the world of the long tail, this will be the company (Google?) that emerges from the dust as the broker of viewers and content.
Product Placement Rears Its Head Online
Someone is finally listening! In an announcement yesterday (via Mashable) VideoEgg announces their exclusive syndication strategy with The Burg an online series about life in Williamsburg. The Burg which aired in June 2006 and is available at theburg.tv started as a twenty minute sit com like series. However VideoEgg appears to be syndicating four minute episodes that are sponsored by Motorola and therefore featuring Motorola products.
Well this was what I've been talking about for a while. The integration of product with content in order to convey lifestyle messages to an audience. The cool hipness of Williamsburg residents should cross over well with the audience that Motorola is trying to attract. Now I guess the big question is if Motorola is willing to split the sponsorship or if The Burg producers are willing to up the ante and not only have a cell phone sponsor but also a clothing sponsor, sunglasses sponsor, watch sponsor....
Survivor made television history as being one of the first reality shows on primetime network television. (I think The Real World on MTV was the first real reality show, but who's keeping score?) Since Survivor and Richard Hatch's win, television has gone on to produce hundreds of reality shows and rekindle the game show as a source of prime time entertainment. While many cited reality television as simply a fad, others have noted the strength of reality not simply in the economics (sometimes 20% of the production budget on a scripted show) but also in the fact that the audience has an opportunity to determine the outcome sometimes (ala American Idol). It appears that audiences want more and more power and when you hear someone in the theater screaming "Don't open that door!" they really mean it.
Well that's great that reality is here to stay, and there's been a bunch of horrible shows out there in the genre and there's been a few that have become part of our culture (The Apprentice, Dancing with the Stars, and of course American Idol), but what does this have to do with marketing? You may remember LonelyGirl15 the YouTube vlogger that was outed as being scripted, and racked up hundreds of thousands of hits all the while. There's been the Subservient Chicken, where you can control the chicken via a text box. Recently I noted a "Text Your Own Adventure" Spiderman video on YouTube. And even more recently, the Diesel Underwear marketing campaign, where two "Heidies" capture a Diesel salesperson and lock themselves into a hotel room for five days. Visitors to the site were able to communicate directly with the girls by asking them to write their names on the guy's flesh, singing a song, and just about anything, similar to Subservient Chicken. There was no explicit branding but a lot of Diesel underwear as product placement. Reports were cited that traffic to the site spiked to five times its normal traffic. So that's it. A reality interactive commercial, creating an interactive event (you can communicate LIVE) without any scripts (clearly since you can ask them to do anything) with a great branding campaign (all of the beautiful people in the video in their Diesel underwear). The two hottest trends out there reality and interactive combined into one. Will we see more of these campaigns? Absolutely. But I think we'll also see more combinations of interactive commercials scripted or reality using the Internet as enabler. We'll see....
Video Ad Overview So the big question of Web 2.0 is how to monetize the online video. Revver has tried to embed an add at the end of the video, Metacafe serves pre-roll, and VideoEgg has an ad overlay that plays during the life of the video. Recently served up are Adap.tv which provides some type of contextual ad placement in the bottom of its player as the video is streaming (via Mashable), ScanScout (via TechCrunch) offers contextual text overlays on the video, and more recently YouTube announced their inline and post roll advertising method. (via Mashable). Are video overlays the way to go? Possibly they could be. However, YouTube's demo doesn't make too much sense. As Michael Arrington notes, the ads served up via YouTube are not relevant to the video at hand and its way too easy to ignore them, while Mashable has the opposite view point. I'm not agreeing with either since I still feel that video ad models are interesting but as a user they are still ads. I'm a true believer that content is king and integration of the advert with content is the best way to go. Remember when Alias was sponsored by Nokia? Or the obvious product placement at BMW Films? I think that advertiser sponsored shows really build goodwill with audiences AND if an element of product placement is involved, great recall of products. However, while I am writing this I know that many are citing the huge bust of Bud.tv. Some products are definitely trickier than others.
However the question if video overlays work remains. And only time will tell. I think though that video overlays are a step in the right direction toward interactivity. As I previously mentioned, video games are the most interactive of movies where you make a decision nearly every second (or several times per second). As TV watchers, an extremely passive activity, we are not used to interacting with anything, whether it's ads or any other type of clickable. Video overlays are bringing us one step closer to that next generation.
Juiced! Joost (pronounced Juiced) has been signing deals left and right with everyone from Viacom to CBS to independent filmmakers to now Heavy.com (via Mashable). It's being billed as "a new way to watch TV" bringing the best parts of the Internet (social networking, time shifting, etc), together with the best parts of TV (high production quality and quality content). Joost created by the founders of Kazaa and Skype (in other words pretty smart guys), could be the next YouTube killer? While Joost doesn't support user generated content (yet?) most of YouTube's traffic or at least a consistent portion of it comes from YouTube partners like CBS, NBA, and other established brands and Joost could be taking a large portion of those eyeballs away especially since YouTube's quality has been criticized as of late. I think that as an audience we seek a more interactive user experience. On one hand we have traditional television where we simply watch. The most interactivity we have is by flipping channels. On the other hand we have video games where we are essentially watching a movie but one in which we are making a decision every fraction of a second. The trend appears to be toward the latter, as we see an explosive upward trend in video games and a gradual downward slope in TV. However, to graduate everything to a video game would be much to extreme and I think that Joost will do a great job in letting people understand that if they are interested in the t-shirt that Matt Fox from Lost is wearing, they can pause the show and purchase it in real time and then go back to watching. Further the social aspect of TV watching will have content creators spinning even more elaborate webs than the ones in 24 or Lost, which will engage audiences. Ad model here? I'm not sure, I think that Joost will probably provide some type of interactive commercial as opposed to the traditional 30 second ad spot. Perhaps Joost can even provide some more power to the almost dead Bud.tv?
Keep an eye on this space as I can't wait to download my Joost trial now!
Monetizing YouTube? ... Not Yet
On YouTube's blog the "YouTube" team mentions that they are going to begin to share revenue with their more popular users outside of their "partners." Partners currently include the biggest traffic drivers to their site like the NBA, CBS, lonelygirl15, and NBC. Now they are going to share revenue with popular users like LisaNova, renetto, and smosh. Revenue share will include participation in Google's Adsense network. This announcement also comes off the heals of Afterworld (Bud.tv's foray into online video content) was announcement (via Mashable) as the first test of YouTube's ad program.
A few very simple questions spring to mind with these announcements. First and foremost: Why don't they share revenue with everyone? YouTube is easily gamed and they are sharing revenue with channels that have the most subscribers or views. You could easily build a bot to knock your views onto the Most Watched list or create many accounts to build your subscription list. And if its a logistical matter of paying out small amounts, have a threshold amount (like $5), similar to Revver. Secondly, this revenue sharing system (of clicking on AdSense ads) doesn't really work. Maybe its my content but I've tried it out (also via Revver) and perhaps its Revver's smaller advertiser base but I've never really had the desire to click on an image based Revver ad let alone a text based Google Adsense ad. Thirdly, most people watch YouTube content not on YouTube but via YouTube's embedded player. (See yesterday's post on Prom Queen and MySpace). Overall, though, I do have to applaud YouTube for making an effort. They're hit with a billion dollar lawsuit. They're probably getting a lot of heat from shareholders about their ROI ($15 million in revenue vs $1.7 billion purchase price). I'm not sure what this Afterworld model will look like but I hope it keeps the viral aspect of YouTube going with a way to embed the ad within the content.
Video Ads More Effective than Images Doubleclick issued a research release about how inline video ads are clicked on more than twice that of banners and images. The report also says that the overall interaction rate is 8 percent! 8 percent! That's a huge number. A number that includes mouseovers, expansions, clicks etc. That number could also be pretty misleading. I've run into a ton of video ads that pop up right when you get to the webpage and you might have "interactions" with it when looking for that hidden "close" button. Unfair you might say. Well, I think that after hearing about this next statistic, which is 0.32 percent press the play button, you'd think otherwise. While this 0.32 percent is double a banner ads click through rate, this is a huge drop off from 8 percent. If the video isn't playing then what? Most likely you're trying to close it, or find the "stop" button. Then Doubleclick says that most videos on average are played 2/3 of the way through. OK, not bad. It could take anywhere from 10-20 seconds to find the close/stop/destroy button. Doubleclick's overall message: Video is twice as effective as Images....
But images aren't really effective. We know that. Whenever we go to a page, we automatically tune out those banners on the top and the skyscrapers along the sides. (Google Adsense speak there.) So what should you do? I've said it once, but I'll say it again, and even Mashable echoes me on this one. Embed your message within your content! A UK boxing promoter is suing YouTube for $1 million. (Rounding error for the Google guys, and a tenth of a percent of what Viacom wants.) The promoter was selling PayPerView subscriptions through his website. But as Mashable states"[the industry] need[s] to adopt a model that provides unlimited syndication, with watermarking and embedded ads, so the business model remains while users still get access to the content. This model would also solve the issue of unauthorized fan footage: rather than keep your version locked up and fight an endless battle to keep cameraphones and video cameras away from sporting events, just offer a higher quality version for free with an ad attached."
People don't want to be sold, but they do want to buy. Advertisements are an opportunity to sell. Embedded content makes them want to buy.
entertainment and the only common thread that everyone on the planet shares is the passage of time. So keeping up with what's new and keeping up with how you should dress (if its cold or warm, not fashion) is pretty obvious. 
