I love YouTube. I love YouTube as a user and I love it even more as a video content entrepreneur. But, I’ll be perfectly honest with you, I have no idea if YouTube will help me grow my business or force me to grow despite it.
Ok, What’s Your Beef Now?
As recently as Q1 2010, our YouTube channel accounted for a third of our total streams; today, that number is just over half. In all likelihood, if you produce videos, you see a similar pattern: YouTube generates more views for you than it ever did, and probably generates 50% or more of your total volume.
The thing is, even though YouTube generates over 50% of our views, it generate less than 5% of our revenues in some months. That’s either a problem or an opportunity (it’s both). In the past I’ve outlined how YouTube is both a commercial and promotional platform; today, I’m less certain than ever about whether it will be more of one or the other.
YouTube’s Awesome March
If the future of the Web is video, then YouTube is the road, car, driver and gasoline. YouTube’s grip on online video only strengthens with each passing month, becoming the de facto monopoly on views and content.
Ah yes, the content. Let’s first look at the noise factor on YouTube:
– in 2007, there was 8 hours of content uploaded to YouTube every minute,
– in 2008: 13 hours/minute
– in 2009: 24 hours/minute
– in 2010: 35 hours/minute
– in 2011: 48 hours/minute.
That’s right: each minute, two full days’ worth of content is uploaded to YouTube. What kind of content? Well, all kinds of content, including:
– Hollywood and studios (“Super premium”)
– Professionally produced content by new-media creators (“Premium”)
– YouTube celebrities that are racking up views and building actual media businesses, if not shows (“Prosumer”)
– Random individuals (“User-generated content”)
– Illegally uploaded (“Pirated”)
Therein lies one of the challenges facing content owners: while elsewhere they compete for mindshare and volume with other producers, on YouTube it’s a bit of a free-for-all, where National Geographic competes with Buffy the cat (not the show, but the feline from North Carolina).
I should stress that in no way am I putting down the YouTube celebs. In fact, at this year’s Vidcon, the number of YouTube partners doubled to 20,000, with “hundreds of them” making six figures a year, according to director of YouTube’s content operations Tom Pickett, and the number of partners making $1,000 a month has tripled in that time. “There is a lot of money coming into the online video space and the creativity emerging is amazing,” Pickett said.
Leveling the field is good for challengers, bad for incumbents — but they’re incumbents for a reason. Historically, it could be argued that professional content creators had an edge, since those with large libraries who refreshed their catalogues frequently enough at least had revenue-sharing commercial arrangements with YouTube, an economic incentive that gave YouTube a reason to promote them. The problem is that the majority of audiences on YouTube seem to favor the content that seems less than desirable from the big marketers.
This may explain why YouTube is trying everything: from rentals to branded channels. Smosh’s President (and former Walt Disney executive) Barry Blumberg once stressed to me the importance of having been an early channel on YouTube: YouTube promoted a handful of channels early on, helping those channels land subscribers. Then as YouTube grew and got acquired by Google, its algorithms favored those channels with high subscriber counts. The cycle continued and became a self-fulfilling prophecy, a new-media video version of “it takes money to make money.”
That means the opposite is also true: if you are starting to produce or distribute videos now and looking at YouTube as a channel, good luck. It’s not impossible, but the odds are stacked against you. I guess that’s why there’s no business like show business.