Part I: YouTube Going Pro — Serving up the ‘Content Holy Grail’ or Risking it All?

Part I: YouTube Going Pro — Serving up the ‘Content Holy Grail’ or Risking it All?

Jun 12, 2012

The team wants to know — are you ready for the Hollywood-Silicon Valley Meetup?

Streaming video, delivered over the Internet, is about to engage traditional TV in a skirmish in the looming war for screen time.

And YouTube — the largest video platform on the globe — is at the heart of the battle.

YouTube is moving decisively from the user-generated anarchy of the old YouTube, to a sort of “YouTV” offering premium content, the kind of stuff you could watch on Netflix and Hulu.

YouTube, the home of grainy cell-phone videos and skateboarding dogs, is going pro, according to a January 2012 article published in New Yorker Magazine by John Seabrook titled “Streaming Dreams.”

Computers have changed the experience of watching TV by allowing viewers to access programs and movies on laptops, phones and gaming devices.

The next phase would be TVs that connect to the Internet through Wi-Fi, which would allow users to stream Web-original content on the TV.

This makes possible a sort of “Content Holy Grail” — limitless viewing choices, all on demand, and available on any Internet-connected device.

YouTube Hearts Hollywood

On May 2, 2012, YouTube announced a $100 million investment in new “channels,” a bid to bring professional entertainment to the world’s largest video site.   It also unveiled a $200 million campaign across Google’s Content Network to push those channels — meaning online ads promoting the nascent entertainment brands will start appearing in a big way.   “We will fish where the fish are…and it’s a mighty big pond!” said Google VP-content Robert Kyncl.

YouTube has recruited producers, publishers, programmers and performers from traditional media to create more than a hundred channels, many of which are now débuting.

  • IconicTV has been given advances for three channels: Life and Times, which will focus on Jay-Z’s cultural and artistic interests.
  • 123UnoDosTres is an urban channel for Latin American young adults.
  • myISH is a channel for scouting musical talent.
  • Madonna and her longtime manager, Guy Oseary, are developing a dance channel called Dance On.
  • Amy Poehler is creating a channel called Smart Girls at the Party.
  • Shaquille O’Neal is behind the Comedy Shaq Network.
  • RIDE is a skateboard channel from Tony Hawk.
  • Brian Bedol, who started the Classic Sports Network in the ’90s, and his partner Ken Lerer, the co-founder of the Huffington Post, got funds for four channels: Network A, an action-sports channel; KickTV, featuring soccer; Official Comedy, a standup-comedy showcase; and Look TV, a fashion-and-beauty channel.
  • The Onion, Slate, and the Wall Street Journal are also creating channels, as are Hearst and Meredith.
  • Disney, which had not made its films available to YouTube until November 2011, agreed to partner with YouTube.

YouTube’s goal this year is to put up 25 hours’ worth of original content every day.

Risky Business?

But is YouTube running the risk of alienating its “everyday people” constituency?

Remember, MySpace suffered steep reductions in traffic when it altered the user experience with redesigns and increased ads.

Netflix lost more than half its value in the stock market and provoked a customer revolt after announcing its plan to separate the streaming and the DVD sides of the business.

It’s possible that YouTube could make a similar mistake, by offering bigger, more professional niches than its amateur-niche audience wants right now.

Still, what’s a gabillion-dollar behemoth company to do?

When Google bought YouTube in 2006, CEO Eric Schmidt described it as “the beginning of an Internet video revolution.” At the time, many wondered if Google had just committed a $1.6 billion mistake.

Some say there’s still no clear answer.  Google has never said whether YouTube is profitable.  The average ’Tuber spends only fifteen minutes a day on the site—a paltry showing when compared with the four or five hours the average American spends in front of the TV each day.

The boys and girls at the Googleplex are apparently going to try to do something about that fact.

Part II: Fascinating Facts About the YouTube TV Revolution