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YouTube Delivers Knock-Out Punch to Competitors

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YouTube co-founder Chad Hurley has hinted future plans of revenue-sharing at YouTube in the coming months. The BBC is speculating that the ads might take the form of 3-second pre-roll, but Chad Hurley didn’t mention that in his comments.

The millions of YouTube videos is a huge inventory that finally gives advertisers a real reason to start investing in the creation of video ads and begin using Google AdSense Video.

I believe there will be three parties seeking compensation:

  • Video content owners — owners of original content. (An audio “fingerprinting” copyright system has been in the works for a while, which will match videos up with content owners, in order to compensate audio/video content owners.)
  • Video content creators — users that mash-up content into custom creations.
  • Publishers — user/company that displays a video on their website to visitors.

One of the many questions is whether ads will appear on YouTube videos that are displayed on websites outside of YouTube.com. If I’m a publisher, I’d want the option to make revenue on a video I publish — but if I’m a publisher (user) on MySpace, MySpace is the ultimate publisher. MySpace is loaded with YouTube videos, but MySpace doesn’t allow external advertising on their website. Also, MySpace has been blocking external widgets randomly and without explanation, so I would imagine that YouTube wouldn’t take a chance by displaying ads in videos that are seen on MySpace pages. Google is already in bed with MySpace, which could lead to rev-share discussions of ads within YouTube videos that stream on MySpace — and also ensure that YouTube doesn’t ever become an unexplained banned victim of MySpace.

YouTube competitors have worked to differentiate themselves by compensating video content creators, but once YouTube enters this game with their top-dog status already — I question what would make a user go to a lesser-visible video site such as Revver, Guba, Metacafe, etc. Competitors have been struggling of recent — Revver lost two founders and Guba lost its’ CEO and two executives.

Editor’s Note: This post was written by guest contributor Steve Poland, whose blog Techquila Shots brainstorms web start-up ideas.

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