YouTube Growing ... Like Cancer?

PreacherTom writes "The success of YouTube has been staggering: they currently field 100 million videos per day and have attracted the attention of influential people like Bill Gates, who may be planning his own video hosting service. However, growth does not always equal profitability. Incorporation of ads risks their very base. If that were not enough, like Kazaa, they struggle with the Damocles' Sword of Litigation hanging over their head each day while bandwidth and server costs continue to rise. Is this phenomenal growth only rapidly killing our favorite video warehouse?" From the BusinessWeek article: "YouTube could easily alienate its users by overwhelming them with ads. And the startup has to figure out how to attract a broader group of marketers by filtering more for copyrighted or offensive videos and by creating more channels of similar content. Aware of the risks, YouTube co-founders Chad Hurley and Steve Chen are moving slowly to ramp up advertising. They have been wary of asking viewers to sit through a 30-second ad before a two- to three-minute clip. Instead, YouTube is developing new formats, like ones rolled out in August that let marketers build their own video channels or pay to place a video on YouTube's popular front page."

Comments

Some graphs to illustrate

[jbum]

I made some lovely graphs to illustrate this growth. These graphs use actual thumbnails from youtube as data points.

That's right - the medium is the message!

Where's the tough decision?

[KalvinB]

Let's see, go bankrupt or alienate some visitors.

Unless it's worth going bankrupt over and having a heck of a time getting financed for the next project, I'd say it's not a hard decision to risk losing some visitors in order to not go bankrupt. It's pretty pathetic when owners of a large site believe in the bandwidth fairy and fail to recognize they're the fairy. They're the ones paying for it.

It's time to either start putting some limits in place to get costs below revenue or to raise revenue. And if some visitors can't deal with it, then good riddence to them. You don't need a bunch of leechers driving you into bankruptsy. They obviously don't care about you so why worry about them?

Max Headroom to the rescue ...

[ScrewMaster]

In the pilot for the old Max Headroom series, Network 23 pioneered a new type of advertising called "blipverts", fast, tightly-compressed burst of audio-visual information designed to prevent viewers from switching channels. Unfortunately, they had the side effect of making their "perpetual, more slothful viewers literally explode" but a similar idea could work here. YouTube doesn't have the advantage of conventional television, where people are watching a minimum 30 minute show, and will sit through a 30 second commercial spot in order to get back to what they really want. YouTube is offering what are essentially extremely short TV shows as their primary product with no real possibility of a commercial interlude. On the other hand, a two second advertisement presented at the beginning, if entertaining (or startling) enough, might be very effective yet not turn viewers off to the service itself.

Heck, if they want this to really work they should offer a plan that would reward submitters for presenting typical YouTube videos formatted as advertising for specific products. Those videos could then be shown to advertisers, who could pay to have the ones they like presented to regular YouTube viewers as advertising.