Exclusive - While YouTube is reportedly paving the way for a major content push in collaboration with studios and networks, its not-so-small competitor Dailymotion isn’t sitting still either. The company has inked a deal with AnyClip to brings thousands of full-length feature films and 50,000 fully license movie clips to its popular video sharing platform.

AnyClip works with studios like Universal and Vivendi, with more deals coming soon, to gain access to full-length films rather than only promotional material, unlike competitor MovieClips. Focused on a B2B model, AnyClip works together with distribution partners to fill their websites with licensed clips.

AnyClip’s proprietary tagging tech extracts and indexes over 5,000 individual pieces of metadata from full-length feature films (including actors, objects, characters and places) and is even able to understand the mood and emotional tone of given scenes, the company says.

Enter Dailymotion, which welcomes some 114 million unique visitors and generates over 1.2 billion video views every month, according to comScore.

Starting today, Dailymotion users will gain access to AnyClip’s library of over 50,000 clips, from major movie studios such as Universal Pictures, Vivendi Entertainment and several indie distribution firms. To get a taste of what they have to offer, check out their list of most popular clips.

Available as an SDK for JavaScript, PHP and Objective C (iPhone, iPad and Mac), with ActionScript (Flash) and Python also under development, Dailymotion’s initial API offering, however, appears to be a work-in-progress. The company says that it will “eventually” support the full gamut of Dailymotion’s core functionality, including video upload, playlists, channels etc. offering the ability to integrate “Dailymotion modules” into any site or application, such as on iPhone, iPad, Android, Bada, and Windows Phone.

It’s interesting to see Dailymotion finally get around to offering a public API, something that Google-owned YouTube has had for yonks. There also seems to be a significant emphasis on mobile apps, which makes a lot of sense given the trend towards consuming content on the go and the advent of tablets but also now that a large share of Dailymotion is owned by Orange.

Last month the telco acquired roughly 49% of the company for approximately €59 million with an option to purchase the rest of Dailymotion at a later date. Although, as we pointed out at the time, the deal looked an awful lot like the French government selling a company to itself, with both Dailymotion and France Telecom-owned Orange in part backed by Fonds Stratégique d’Investissement (FSI), the French government’s sovereign wealth fund.

Advent Venture Partners, an investor in DailyMotion since 2007, said that investors were actually not seeking to sell the company, which has apprently been profitable since the latter half of 2010. However, the company did seem to be burning cash prior to that point; over $68.5 million had been raised with some of Europe’s top tier VCs in 3 different rounds of funding.

DailyMotion was the longtime reigning video platform of choice in France (even after the Google-YouTube acquisition) and has 90 million users of which 80% are situated outside of France (namely in the US, India and Turkey). The acquisition is most likely going to allow Orange to further develop video on various mobile devices  and also integrating it with additional content sharing platforms.

DailyMotion’s story usually tends to evoke a lot of mixed reactions. Some feel it’s a success while others a failure. Interestingly enough, DailyMotion and YouTube were founded within weeks of each other in 2005. However, the San Bruno-based company was swallowed up by Google the following year for $1.65 billion while DailyMotion trodded along. Still, the platform managed to continue growing despite the threat of Google’s YouTube and is currently the 2nd ranked video platform worldwide.

For now, half the company has been acquired – we’ll keep you posted as Orange reveals info concerning the second stage of the transaction in the upcoming months.

5Min is one of the largest how-to video networks, with more than 110 million video views a month and 30 million unique visitors across 800 partner sites. 5Min syndicates videos from about 1,000 online video producers, including CBS, Hearst, Scripps, and WatchMojo.

Dailymotion’s audience will now have access to 5min Media’s library of more than 200,000 videos organized across 21 verticals including 5minSports, 5minTravel, 5minVideo Games, 5minFashion and 5minHealth. 5min Media’s content on Dailymotion will be categorized within branded channels. The financial terms of the deal were not disclosed.

Dailymotion, which has a large user base in Europe, has tried to distinguish itself from competing online video offerings (Namely, YouTube) by providing a mixture of user-generated content and advertiser-friendly professional video, such as independent films. Of course, YouTube and others have more recently begun posting professional and premium content, encroaching on Dailymotion’s territory. As of last fall, Dailymotion was profitable (and some thing that the site will soon be acquired).

Editor’s note: Guest author Ashkan Karbasfrooshan is the founder and CEO of video site WatchMojo. Below are his picks for the ten most likely M&A deals in online video. Previously, he wrote a series if posts about the state of online video (Part I, II, III, and IV).

Which online video companies will get bought in 2010?   Venture capitalists are desperately looking for exits while the usual suspects are sitting on more than $80 billion in cash: Microsoft ($20B), Apple ($40B), Google ($15B), Amazon ($3B), and Yahoo! ($3B) just to name the cash positions of a few potential acquirers.  Theoretically, it should be a match made in heaven, but the sheer number of venture-backed video startups is staggering so when the music stops, not everyone will find a dancing partner.

Once you assess what drives companies to merge or acquire one another, however, it seems like we’re about to enter a period of mergers between video competitors and see a series of acquisitions by larger companies looking to accelerate their video strategies, with a common theme being increasing both monetization and margins.

Right now, as the chart above shows (click to enlarge), there are two types of online video companies: those with sky-high ad rates but fairly limited inventory (company A) and those with huge inventory but woeful monetization (company B). Companies can extend profitability through technology, ad solutions or content.

With that in mind, let’s look at those 10 potential deals.

1. Demand Media will acquire Tremor Media

Demand Media has raised $355 million but to this day still generates the bulk of its revenue from its domain registrar unit, eNom. However, it is trying to move into the content business, with its “Content Farm” strategy getting a lot of attention.

Demand Media’s existing content lends itself better to an arbitrage strategy built around Google marketing and monetization, but over time it will want to do a better job entering both display and video advertising and it will do that by buying one of the many, many video ad networks out there. Brightroll, which is focused on brands, is one option.  Tremor is another, focusing on reach.  That strategy should fit well with Demand Media’s modus operandi.  Tremor Media’s ads reach 177.6 million uniques, or 85% of internet users.

2. Lagardere Groupe will acquire Dailymotion

At first glance, French media conglomerate Lagardere seemingly sees no value in communities as a marketing platform: “There is no clear business model because you have a huge, massive audience, but it is not a marketing community,” says to Lagardere’s Chief Financial Officer Dominique D’Hinnin.

Monsieur D’Hinnin might be right, but never underestimate France’s sense of nationalism. Dailymotion is France’s answer to YouTube and it has taken steps to reduce its share of user-generated and pirated content in favor of professional videos. (Disclosure: Dailymotion is also one of WatchMojo’s distribution partners).

With $68.5M in funding—including a tidy sum from Le Fonds Strategique d’investissement, which is an investing arm of the French State—you can imagine that one of the pillars of the French media landscape, Lagardere Groupe could eventually step in and acquire Dailymotion despite its admitted monetization problems: “At the moment, we are poor at monetising our audience,” admits Dailymotion CEO Cedric Tournay. Lagardere could help with that provided Dailymotion can continue to de-emphasize its less advertiser-friendly content.

Additionally, Lagardere will be able to leverage Dailymotion’s audience to promote its own content: the company owns Hachette along with numerous other media entities.

3. Scripps will acquire 5Min

When 5Min (another one of our distribution partners) launched, it focused on user-generated how-to content. Thankfully for them, they have since moved away from that and currently mesh

a) aggregated premium and super premium content with

b) their monetization engine, a strategy which has propelled 5Min to become a Top 10 comScore video company.

Scripps is a producer of super premium content, and like Discovery Holdings, it might prefer to distribute its programming through TV and cable. But, with consumers viewing more and more videos on the Web, it will need more content for its sites and will look for more inventory online.

The two companies already have a strategic deal in place, so they have some familiarity with each other.

4. Google will acquire Ooyala

Last year it was rumored that Google was going to acquire Brightcove for $500-700M. That was always unlikely because many of Brightcove’s financial backers are the very same media companies that view Google as the bane of their existence.  Moreover, Google makes a lot of acquisitions but rarely are they large (YouTube, DoubleClick and AdMob being the exceptions).

A more logical fit to expand its video foothold would be Ooyala, which competes with Brightcove and includes Glam Media and others as clients… and was founded by a former Google executive.

Google has the consumer video market cornered with YouTube.  Iit could leverage Ooyala to go after the corporate market by undercutting Brightcove.

5. Microsoft will acquire Brightcove

The consolidation in ad services peaked with Google’s $3.1 billion acquisition of DoubleClick and Microsoft’s $6B acquisition of aQuantive. After selling ad agency unit Razorfish, today aQuantive is Microsoft Advertising, and as advertising continues to move into video, MSFT will probably want to offer a video content management to go along with the Atlas ad serving platform.  That is where Brightcove fits in.

If you think about it, Google owns video search by way of its YouTube acquisition. Microsoft wants to push into cloud computing and at least conceptually, owning Brightcove would give it a legitimate cloud computing foothold in professional video content with no real threat to any of its core businesses. It could also better integrate Brightcove (which increasingly powers media companies’ videos) into Bing’s video search, helping it kill many birds with one (albeit expensive) stone.

6. Yahoo! will acquire Freewheel

After acquiring Blue Lithium and Right Media, Yahoo! got a shot in the arm and grew its advertising reach across the Web, outside of the Yahoo.com property.

Freewheel is founded by former DoubleClick employees but Google (which bought DoubleClick) might have less interest than one would think in augmenting its video advertising reach across the Web considering it owns YouTube which accounts for 40% of online video consumption. YouTube only monetizes a small share of the billions of videos on the site.

Freewheel, which allows marketers and publishers to manage campaigns across a variety of distribution sites, would be a nice fit with Yahoo!, which might want to extend its Audience Network in video offerings.

7. Gannett will acquire Livestream

Gannett already invested $10 million in Livestream (then known as Mogulus).

The fit is a natural: print media will want to bolster its video offerings (be it content or technology). The main challenge here is that media companies have grown wary of buying technology firms, but news organizations will have a natural predisposition for all things live and the investment sets the stage up for an all-out acquisition.

8. Nielsen will acquire TubeMogul

TubeMogulprovides analytics to countless marketers and publishers (we use them at WatchMojo). Nielsen and comScore are both looking at adding video capabilities and TubeMogul has done a good job of getting wide adoption, providing Nielsen with a quick entry into the burgeoning video space.

Also, David Toth, former president, CEO, and co-founder of the NetRatings service joined TubeMogul’s board.

9. AOL acquires Howcast

AOL’s recent acquisition of StudioNow is a sign of things to come: When AOL was spun off from Time Warner, it was shackled with restrictions on its use of cash and thus the size of the deals it could complete.

But AOL wants to create content, lots of it. AOL’s Tim Armstrong is an investor in Howcast; he was also an investor in Patch, a local startup Armstrong acquired after joining AOL (to his credit, he simply recouped his initial investment and did not participate in the capital gain).

Howcast creates videos themselves, lets users create and upload videos and aggregates other professional content (Howcast is one of our distribution partners as well). While Howcast might have proven redundant with the StudioNow acquisition, AOL has a history of doubling up when it focuses on a space (think ad services: Tacoda, Advertising.com, and Third Screen Media) and Howcast is more focussed on how-to videos.

10. News Corp. acquires Break Media from Lionsgate, spins off NewCo

News Corp.’s Rupert Murdoch is in the process of divesting from the Web: first selling Photobucket, then chucking Rotten Tomatoes to Flixster while retaining a stake in the new venture.  I see something similar happening with Acquisition #10.

Break Media is one of the so-called YouTube clones who has managed to differentiate itself by focusing on the men’s 18-34 market and creating content, be it videos and now video games.  Back in 2007, Lionsgate invested $21 million in stock for a 42% stake in Break.com. At the time, it also got a call option (basically, the right to buy) which is “exercisable at any time from June 29, 2007 until the earlier of 30 months after June 29, 2007 or a year after a change of control, to purchase all of the remaining 58% equity interests (excluding any subsequent dilutive events), including in-the-money stock options, warrants and other rights, of Break.com for $58 million in cash or common stock, at the company’s option.”

The 30 month window expired on December 29, 2009, and despite Break’s momentum, I don’t see any major incentive for Lionsgate to exercise its call option. I do, however, see the following happening (well, maybe…).

Lionsgate might be more willing to trade its 42% stake in Break Media for a smaller share in a NewCo. that houses both Break Media and News Corp.’s IGN Entertainment, another leader in the men’s 18-34 space. (again, bothh Break and IGN are distribution partners).  This NewCo. would then be a more likely candidate for an IPO and would allow both Lionsgate and News Corp. to focus on their core businesses and cash out their investment over time.

Needless to say, all of the above deals are idle, if informed, speculation on my part.  What do you think are the most likely video exits this year?

Editor’s note: This is the fourth in a series of posts by guest writer Ashkan Karbasfrooshan.Previously, he wrote about the State of Online Video, 12 Surprising Things Holding Back Online Video Advertising, and Context is King: How Videos Are Found And Consumed Online.  In part 4 today, he examines where he thinks the sweet spot is for making money in onljne video. Karbasfrooshan is the founder and CEO of WatchMojo.

In Search of Profits

Ten years ago, web companies didn’t generate much revenue.   These days, web companies are some of the most profitable around.  Online video is where the Web was ten years ago: in investment mode as video companies that are generating high revenue are not necessarily the most profitable.

Are those companies suffering low margins because they’re investing in the future or are they fundamentally lower-margin businesses?

Ad Networks Are Low Margin Businesses

This week, video ad network Brightroll raised $10 million from Scale Venture Partners.  Ad networks aggregate audiences and sell ads to marketers, sharing the proceeds with publishers/producers.  Scale’s Rob Theis’ argues: “the most strategic Internet investments are those that compete not with other Internet businesses, but with the much larger amount of money still being spent offline.”

Brightroll’s CEO Tod Sacerdoti added: “I think by this time next year the majority of the top five to ten video properties by any measure will be aggregator networks.  The best example for this is display advertising.”  Indeed, networks have an unmatched ability to scale but can also crash to the ground awfully fast.

The low margin is the least of their problems; differentiation and defensibility are.  Blue Lithium and Right Media hit jackpots by selling to Yahoo!  But those who didn’t sell (Tribal Fusion, Valueclick) suddenly found themselves under pressure from search advertising on performance and video on branding.

Content Networks Have Little Differentiation

Similarly, aggregators gather videos from content providers, sharing ad revenues.  iFilm (sold to Viacom, renamed Spike), Guba, Grouper (sold to SONY, renamed Crackle), Revver, YouTube (sold to Google), Veoh, DailyMotion, Metacafe, Viddler, blip.tv, are all vying for content, audiences and dollars.

YouTube is master of this domain.  Hulu is giving YouTube a run for its money, but the business model is anything but certain and its long term exit strategy is murky (Disney, News Corp. and NBC Universal/Comcast are shareholders but also competitors).

Ultimately, ad and content networks operate in a high-risk, winner-take-all game.   For publishers, it’s a lower risk world.  Consider the two acquisitions News Corp. made in 2005: Rupert Murdoch paid more for IGN ($650M) than for MySpace ($580 million), but MySpace’s subsequent growth made him look like a genius (for a while).  Today, MySpace is searching for its raison d’etre while IGN treks along as an unstoppable force in its sphere.

The Myth of Hyper Distribution?

In online video, producers are agnostic to distribution channel or platform.  To reduce risk, they diversify distribution, but the jury’s out on whether hyper distribution bears fruit.  Hyper distribution refers to syndicating one’s content as broadly as possible with little or no restrictions.

When it comes to generating revenues, is hyper-distribution wise?  Not according to Chris Pirillo, a prosumer video producer who leverages video to promote his empire but only counts YouTube as a commercial platform: “YouTube offers the largest audiences and generates most the revenue.  If you’re not YouTube, you have challenges in creating value for content producers”.  If that changes, look out for Freewheel, which according to CEO Doug Knopper allows “media companies and content owners to be able to monetize their video libraries across multiple channels and devices”.

Advertisers Follow Audiences…

Ex-Disney CEO Michael Eisner doesn’t pretend to know how the industry is going to play out, but he’s got no doubts what the end result will be: “I don’t know if the growth in content made for the Internet will be evolutionary or revolutionary, but it can’t not happen: a death march has been going on for other media who are in trouble because there is a more efficient way to share content around the world with the Internet.”

Business Models Take Time to Develop

Eisner made his fortune in television.  One VC who’s made his online has another opinion.  In Fred Wilson’s influential 2005 post “The Future of Media (aka Please Take My RSS Feed)”, he suggests to:

1 – Microchunk it – Reduce the content to its simplest form.
2 – Free it – Put it out there without walls around it or strings on it.
3 – Syndicate it – Let anyone take it and run with it.
4 – Monetize it – Put the monetization and tracking systems into the microchunk.

In theory, in the future when video streams monetize the way search queries have (whereby a search query is always associated with some kind of paid listing) then perhaps Wilson’s thesis will prove right.  But in practice, at least in the five years that have passed since the post, it’s been a recipe for financial disaster.

Hyper distribution is great for promotional purposes but not necessarily for commercial purposes.  Marketers do pay more attention as an audience grows, but they also pay a premium for scarcity and exclusivity.

This is the fundamental conundrum facing new media producers who rely on hyper-distribution to build brands and audiences but who weaken their pricing power and ability to secure guaranteed dollars by giving away their videos.  This can work if you can build ad-supported businesses, but that takes time and money.

Today, a few new media producers have managed to build ad-supported businesses, namely Revision3 and Next New Networks.  But between the two, they have raised over $30 million in venture capital.  Most producers don’t have that luxury.  For those others, I recommend creating content that other media companies will pay for, to buy them enough time to build a syndication business and eventually, a fully ad-supported business which commands the large ad dollars.

An imperfect but useful analogy I use is the banking model, where retail, corporate and investment banking fees can create a large business.

This diversified strategy provides:

• a safe income stream:  licensing, like retail banking, provides a recurring and non-volatile revenue base.
• a growth business: syndication, like corporate banking, requires other companies in the ecosystem to do well.  This can provide higher CPM rates by placing content in the right context.
• a wildly lucrative stream: advertising, like investment banking, takes time to develop, is speculative and seasonal, and risks drying up abruptly.  Notice how advertising revenue spikes each fourth quarter, for example.

The reason why I place content producers in the highest Profitability circle over time  in the first chart above is because only they can build such a business.  (The Profitability Index represented in the chart takes into account operating margins and total return on investment, including likelihood of a liquidity event).  And, yes, I am completely biased, since this is the kind of business I am trying to build with WatchMojo.  Aggregators and networks are solely advertising based businesses; just ask YouTube who generated $10,000 in a paid model test, even though it can generate billions in simpler ways.  Video advertising will be a bigger business, but not necessarily a higher-margin business.

Video will be Everywhere: on all Websites

Video on the Web is no longer just about entertainment.  It is also about marketing, instruction, and conveying information of all kinds.

• Content bellwether Wikipedia announced it will be rolling out videos soon enough.
• e-Commerce leader Zappos encourages users to submit their video experiences which increase sales 6% to 30%.  In 2010, it will create 50,000 videos.
• It won’t be long before organizations feature their accountants, lawyers, management, VCs in videos too.

Video will be Everywhere: in Ads

Videos won’t simply be on all websites; video ads will converge with rich media and display banners.  Publishers and ad networks will swap out low yield ad placements for videos that sell at a premium.  Rupert Murdoch is right to say that there isn’t enough advertising to make all publishing online profitable, but if you insert a video-enabled ad where a display banner exists today, maybe it will become more profitable, as video rates tend to generate a tenfold premium over display banners.  Of course, the flip side of that argument is that if video ad inventory lost all scarcity as display banners have, then it rates would also see a steep drop.

Video is the Anti-Search

Google’s dominance of the Web today stems from a perfect storm.  Search benefitted from low expectations.   Whereas Google’s competitors threw in the towel to focus on portaldom (or outright handed them the business), online video companies’ war chests seemingly have no bottom as they wage the war for the online audience.

With YouTube being a unit of Google, it’s hard to compete being a pure video aggregator.  Those who have tried are flailing badly.  Yet video’s expectations have always been high and will only get higher.

History Repeats Itself

Video will follow search in two ways though.

Search is software and Google is the only successful ad-supported technology company.  Video is media, which has a natural disposition to embrace ad-supported models.  As such, advertising will monetize video streams.  In fact, as large ad agencies and marketers shift online, they’ll embrace branding campaigns and push video advertising could eventually top search advertising.  Once that starts, online advertising will surpass television, it’s already happened in the UK.

Search for The Leading Ad Format

Everyone agrees that video advertising will be huge but what will the prevailing ad format be?

Stakeholders are obsessed with finding the ad format likely to follow television’s 30-second ad spot and search’s paid listings.

What might lead the way?

Pre-rolls are the equivalent of pop-ups (and mid/post rolls the equivalent of pop-unders) in that users hate them, but unlike pop-ups, I actually think pre-rolls won’t disappear, mainly because

• They’re the most in-demand ad format (according to Brightroll CEO Tod Sacerdoti)
• It is easier to include a pre-roll when you’re syndicating to other websites and platforms (says blip.tv co-founder Dina Kaplan)
• But largely because they’ll get more user-friendly: the 30-second ad will make way for 5-10 second interactive pre-rolls (SpotXchange CEO Michael Shehan).

However, there will always be properties which will forego pre-roll revenue to improve the user experience in order to build audiences, and all else being equal users will migrate to those sites.  So I’m not sure the pre-roll will remain all that ubiquitous.  The other problem with pre-rolls is lack of attention.  When a pre-roll starts, I tune out and look for my headphones or go grab a coffee.

That’s why I like the contextual display banner (and not necessarily the companion banner).  A companion banner comes bundled with the video pre-roll, but sits alongside the video  A contextual banner comes without the pre-roll.  Whereas most banners disappear quickly next to text with one downward scroll of the mouse, alongside a video player, that banner becomes quite valuable and top-of-mind since people are just staring at the video.

We’ve also seen the rise (and fall) of overlays, which is basically an expanded Picture-in-Picture (PIP) format; we know how that fared.

Of course, content producers are also salivating over branded content (more than product integration and product placement, the brand becomes central to the story) or outright sponsorships.

Finally, there’s the Web’s favorite offspring: the viral video.  Viral video is not an ad format, of course, but it is not quite branded content nor is it supported by ads.  As these become more common, achieving success with content alone becomes a sure-fire recipe for failure.  All content will need to be supported by a media buy or some kind of promotional push.  After all, on TV you spend millions creating an ad but you need to buy media spots to promote it.  It’s not going to be that different online.  Yes, it’s a meritocracy, but it’s a loud, cluttered one.

KISS: Keep It Simple Stupid

There won’t be a single dominant ad format but the holy grail will prove simpler than expected.  It always does.

Remember Don Lapre’s infomercials?  He would go on and on about placing “Tiny Classified Ads” in newspapers.  I never thought much of those ads until Google’s adoption of (essentially) little text ads next to search results led to their explosive growth.

Sometimes in business, the solution is simpler than you can imagine.

No surprises there, but since MeFeedia’s video search engine self-reportedly tracks over 30,000 video sources across the Web, the company slapped some interesting numbers on the most apparent trends.

How many vlog?

While MeFeedia tracked about 20,000 unique vlogs back in 2007, it’s currently keeping tabs on over 110,000, which represents an increase of more than 500% over the past 3 years. International vlog numbers are growing faster than the U.S., with Spanish-language video blogs leading the way.

Turns out all those vloggers are less keen on setting up an independent video blog and rather flocking to the major online video hosting and sharing services to try and attract an audience and make some money off their videos.

Where do they vlog?

Unsurprisingly, the most popular platform is YouTube with 36%, up from 9% based on MeFeedia’s 2007 findings.

After YouTube come Blip.tv with a respectable 14%, Vimeo with 9%, MySpace with 7% and the only European service, DailyMotion, with 3%. About 13% uses other video sharing platforms, although I find it surprising that Facebook didn’t make this list. Independent publishers, meaning vloggers who set up their own websites and video hosting platforms, make up 18% of the pie. The most popular tool for them: WordPress.

Pro vloggers

Professional vloggers (i.e. producers of Web series) tend to follow a dual strategy: posting content on their own websites while syndicating videos to popular video hosting platforms simultaneously.

According to MeFeedia, the average pro-vlogger syndicates their video to 3.6 sites. Their top choices are YouTube, Blip.tv and MySpace Video.

Syndication trends

MeFeedia also spotted some trends in syndication and says Google’s FeedBurner is no longer the “default” syndication mechanism, as MRSS tools have become much more sophisticated over the past few years. They’re also being offered by YouTube, DailyMotion and also Videopress as a built-in feature.

MeFeedia also says automated posting and tracking tools such as TubeMogul and Hey!Spread have gained popularity as they provide content creators a “produce once, post everywhere” model that saves them time.

Video consumption

According to MeFeedia, 1024×768 is most popular screen resolution (40%), followed by 1280×800 (20%), 1280×1024 (10%). The most popular for TV viewing is the Playstation 3, followed by the Nintendo Wii.

The report also states the watch time for short-form videos is 1:15 minutes and 8:50 minutes for long-form content, on average. Unsurprisingly, people are watching more short-form than long-form video content.

The growth in video consumption on mobile platforms was one of the fastest, particularly on iPhone, Android and BlackBerry devices (in that order). The iPhone was the fastest growing mobile device for video consumption (by 6x), which MeFeedia correctly deems largely fueled by the built-in YouTube support of the Apple phone.

(Image credit: Flickr / Clintus McGintus)

Like the plethora of competing iPhone video offerings, Dailymotion, which as been called the French YouTube but has much wider reach across continental Europe and elsewhere, is at a significant disadvantage compared to the Google-owned video sharing site, which comes pre-installed on the iPhone. That said, the functionality provided by Dailymotion’s iPhone app at least matches YouTube’s offering.

iPhone users can search for videos on Dailymotion, view featured and the most popular (viral) videos of the day, browse channels and access their Dailymotion account. IPhone 3GS owners can also record and upload videos to the site.

Dailymotion has always tried to distinguish itself from competing online video offerings by providing a mixture of user-generated content and advertiser-friendly professional video, such as independent films, a distinction that has become less and less relevant these days as rivals, including YouTube, adopt a similar strategy. Unlike YouTube, however (although Google doesn’t break out the numbers), Dailymotion claims to be profitable and says that revenue is increasing at a faster rate than bandwidth and other infrastructure outgoings, which account for 25% of the company’s operating costs.

In October, Dailymotion raised another €15 million in financing, bringing its total funding to just over €40 million. The company is backed by Atlas Venture, Partech International, Advent Venture Partners, AGF Private Equity and Fonds Strategique d’investissement.

Like the plethora of competing iPhone video offerings, Dailymotion, which as been called the French YouTube but has much wider reach across continental Europe and elsewhere, is at a significant disadvantage compared to the Google-owned video sharing site, which comes pre-installed on the iPhone. That said, the functionality provided by Dailymotion’s iPhone app at least matches YouTube’s offering.

Tournay, who joined as CEO just a couple of months ago, tells Capital.fr that the venture recently turned profitable, but that additional investment was required to fund its steep growth. He expects a 50% increase in turnover in 2009 and 2010, and says DailyMotion currently serves 1 billion video views per month.

Tournay also mentions that costs were cut by 20% over the Summer, mainly on the salary side. He added that 25% of the company’s costs is bandwidth and infrastructure, but that they are increasing at a slower rate than the revenues at this point.

Note that PaidContent reached a different conclusion, even though Tournay clearly says turnover is growing more rapidly than operating costs: “Et nous allons bénéficier d’un effet de taille : nos investissements en bande passante, qui représentent 25% de nos frais d’exploitation, augmentent moins rapidement que notre chiffre d’affaires” which translates to “And we will benefit from the size-effect: our bandwidth investments, which represent 25% of our operating costs, are increasing less rapidly than our turnover.”

He says this evolution will have a significant impact on the bottom line by next year, although he also admits that they’re currently not monetizing their vast audience (a self-reported 60 million unique visitors per month) well enough yet: only 10% of videos on the service currently carry advertising.

Questioned about a potential IPO down the road, the company’s chief exec says it’s a possibility but that they’re ‘not there yet’. The startup has been in talks with potential acquirers, he confirms earlier rumors, but adds that the current wish of management and investors is to remain independent and to continue developing new products.

Dailymotion raised the additional €15 million in funding – which brings its total to just south of €40 million or $58.8 million – from its existing investors (Atlas Venture, Partech International, Advent Venture Partners, AGF Private Equity) and a new, undisclosed one. This new investor will be announced in the coming weeks and led this round with support of all previous backers.

Dailymotion, sorta the YouTube of Europe, has inked a deal with the much-maligned OLPC folks to “explore collaborations involving Dailymotion’s technology and selected educational content to benefit underprivileged children globally.” Sounds important.

Unnecessary snark aside, it actually sounds like one of those “good causes” I like so much. The deal is such that the OLPC folks can now benefit from Dailymotion’s infrastructure to have kids create and share videos of their experiences using the built-in camera in the XO Laptop. To that end, Dailymotion has even gone to the trouble of creating a subdomain, olpc.dailymotion.com (that’s for XO Laptop users, regular folk will have to use dailymotion.com/group/olpc), where you’ll find all sorts of educational goodness.

But, since online it’s “cool” to hate on the OLPC folks for trying something different, maybe we should just tease them for each and every effort they make.

The problem has gotten so bad that Turkish blogs are now banning themselves in protest. The fake bans started with Firat Yildiz, who put this message up on his blog:

Bu siteye erişim kendi kararıyla engellenmiştir

which roughly translates to:

The access to this web site is prevented by its owner’s free will.

Then another Turkish blogger, Selim Yoruk, created this page with a piece of code that lets any blogger easily add the same message to his homepage. Nearly 200 Turkish blogs have (temporarily) shut themselves down in this manner. The point is to show Turkish Web surfers what the Internet would look like if the censorship continues unabated. The protest will last until Wednesday.

(Photo by John Walker).

Here’s an interesting Q and A session with a panel of experts in the rich media industry — mostly online video – that took place last Tuesday at the Pacific Crest Technology Leadership Forum in Vail, Colorado. The members of the panel:

• Ron Bloom, CEO, MEVIO
• Mike Hudack, CEO, Blip.tv
• Steve Liddell, CEO, Panther Express
• Joy Marcus, General Manager, DailyMotion U.S.
• Perry Wu, CEO, BitGravity

Here are the questions, followed by a brief synopsis of the answers, followed by the complete answers in MP3 format.

Q: How has the behavior of the consumer changed over the past year?

• Joy Marcus – We’re seeing a lot of people moving from high-level, squeaky clean Hollywood stuff to more gritty “Pro-tail” stuff, which is semi-professional, long-tail content.
• Ron Bloom – Consumers are tired of watching TV. They’ll make their own 30 minutes of entertainment. The real goal is to displace television viewing with a type of viewing that’ll attract brand advertisers. The audience is okay with advertising, they just want a little more freedom of choice. Audience doesn’t know the difference between professionally produced content and garage content – they just know what they like.
• Mike Hudack – People are starting to use YouTube as a search repository. Other services are better for entire shows to be delivered similar to how a DVR works. We’re seeing more and more people embracing episodic content.

Audio (7:24): http://old.crunchgear.com/audio/richmedia01.mp3

Q: What are your thoughts on time spent online, traffic, and consumption?

• Perry Wu – We haven’t seen a slowdown in the media space. We’re just putting more and more media on the Internet. Traffic continues to grow on an exponential curve. There’s a seasonality to our business but there’s still a lot more content than there was a year ago, so we see a lot more traffic.

Audio (3:24): http://old.crunchgear.com/audio/richmedia02.mp3 

Q: Broadband has been a big driver. What else can we look forward to as far as driving traffic is concerned?

• Steve Liddell – Live events are growing exponentially. Live is way more important than anyone thought it was going to be. Applications built around live events make it really compelling to watch things online – chat features, gaming, etc.

Audio (1:38): http://old.crunchgear.com/audio/richmedia03.mp3

Q: What kind of metrics matter to you?

• Ron Bloom – You have to understand who your customer is. Our customer is the audience, our partner is the owner of the content, and the beneficiary of that relationship is the advertiser. We’re not driven by viral content, stolen content, or pornography, we’re driven by creating an entertainment environment that engages the audience.
• Mike Hudack –  One of the most important metrics you can watch is the amount of a particular video that somebody watches. It needs to resonate with someone right away. The average time before someone clicks away is eight seconds.
• Joy Marcus – We’re known for a very high quality video player. We’re also now offering HD, which has been a big focus for us. Quality of content is important but so is the quality of the experience.
• Mike Hudack – There’s also a challenge about where your content is distributed. What if an ad for Holiday Inn is shown on a blog that trashes the travel industry?

Audio (11:07): http://old.crunchgear.com/audio/richmedia04.mp3

Q: In terms of user generated content, will we ever be able to monetize it or will it just be a traffic driver?

• Ron Bloom – Google did two interesting things. One, they made search into a pastime. Two, they made advertising for everyone except brands. What’s missing is that there’s no safe haven for brands. The audience is getting tired of user generated content. A new group of companies and service providers is emerging. Can you build a large enough audience to rival television so that you can give brand advertising the audience you have with television along with the efficiencies of the internet?
• Mike Hudack – One of the problems that YouTube has and viral video has in general with user generated content is that you can monetize it, but do they have the right to monetize that content?
• Joy Marcus – We have to distinguish between display advertising and in-video advertising. We have no problem monetizing display ads on our player page. When you’re talking about putting a video ad inside a video, where does that video go?  And what happens when a video ad gets placed inside a video we don’t know much about?
• Perry Wu – One of the things that’s largely ignored in the market is paid-for content, particularly live content. That kind of content is perishable, so people are willing to pay for it. Companies are afraid to charge for stuff on the internet. Not saying that everything should be for-pay content, but there are hundreds of events happening on a weekly basis that people will pay for.
• Steve Liddell – While everybody’s talking about advertising, very few people are talking about DRM. You’re going to see a renaissance in paid content and DRM.
• Ron Bloom – By this time next year, brands won’t need to worry about user generated content. There will be large enough audiences for brands to safely advertise. People will move away from TV.

Audio (12:46): http://old.crunchgear.com/audio/richmedia05.mp3

Q: How important is it to make sure that your content is accessible on set-top hardware devices so that the people who resist consuming online content at their desks will be able to consume it in their living rooms?

• Mike Hudack – The numbers are extraordinarily small right now and the opportunity to traffic third-party verified advertising dynamically in these environments is basically non-existent. We approach it right now as “We want to put a stake in the ground” and it’s a marketing tool to be able to tell a content creator that they’ll be on TV. The challenge is that only a small number of these outlets can handle any type of scale when it comes to content choice. There’s literally limited hard drive capacity at the head. Out of our 33,000 shows, we have to pick about ten to send to Verizon (FiOS), so the experience isn’t the same.
• Perry Wu – There’s a big economic barrier to overcome. The set-top boxes are subsidized by the MSO’s (multi system operators). The number of TiVo boxes is puny compared to the number of cable boxes. The cable box, plus the cost of deployment, has to be under $300. So they have limited processors and limited hard drive space, especially with online video pushing higher quality and DRM.

Audio (4:30): http://old.crunchgear.com/audio/richmedia06.mp3

Is there room for a video-sharing site besides YouTube? Intel Capital, Adobe Systems, and media investor Gordon Crawford are placing their bets on Veoh, which is announcing a $30 million series D financing. Intel Capital is leading the round, and previous investors Shelter Capital, Spark Capital, Goldman Sachs, Time Warner, Michael Eisner and Jonathan Dolgen also participated. This brings the total Veoh has raised to a whopping $70 million.

Veoh wants to move beyond the PC to mobile devices, and is putting a lot of resources behind developing its behavioral ad targeting platform for video.

The announcement also comes a day after Veoh started blocking access to all but 33 countries (plus U.S. territories) in an attempt to focus on the most lucrative markets (and, no doubt, reign in some costs—video streaming is expensive). The countries being blocked, including many in South America, Eastern Europe, and the Middle East, represent less than 10 percent of Veoh’s audience.

That audience, globally, is growing at a nice clip. The company claims 28 million monthly unique viewers, who on average spend 100 minutes a month on the site. And the avreage length of videos watched on Veoh is 10 minutes.

ComScore counts 18.5 million global unique visitors, as of April, and another 8.7 million who watch on the startup’s P2P software client, VeohTV. If you add the two together (the red and purple lines in the second chart below), it comes to 27.2 million, which is about the same as the total reported by the company. That combined total would put Veoh’s audience right below Metacafe’s (28.9 million) and DailyMotion’s (34.6 million).

And it is growing much faster than either one (538 percent over the past year, versus 70 percent growth for DailyMotion and 50 percent growth for Metacafe).

Of course, Veoh and all of these second-tier video sites still pale by comparison to YouTube, which boasted 300 million unique visitors worldwide in April.

Pandora.TV launched in 2004 and has grown to become the “YouTube of Korea,” ranking as the countries 24th most popular site according to Alexa (comScore data is not available) with 20 million monthly unique visitors, 2.5 billion monthly page views with 2.5 million hosted videos. Notably the company has taken $16 million over two rounds from Altos Ventures and DCM, said to be the largest foreign investment made in a Korean internet startup.

Pandora.TV offers a mix of YouTube style videos and Live streaming. Like YouTube, videos can be embedded, voted upon and comments left on each page. A key selling point is unlimited video storage.

As of today Pandora.TV is now available in English, Chinese, Japanese as well as its native Korean. New features rolled out with the international expansion include HD quality video playback (H.264 codec support), multiple video upload (up to 5 files simultaneously), unlimited category creation and site widgets. Pandora.TV has also claimed cross-browser support as a new feature, however the Live Streaming service requires a download to view and stream that is only available to Windows users.

Google is noted as not being a member of the grouping, but in discussions to join.

The group will address copyright-related issues including video piracy, with a focus on using technology to eliminate copyright-infringing content and blocking any infringing material before it is publicly accessible.

Google launched anti-piracy technology on YouTube Monday.Viacom sued Google over YouTube content in March.

Time for another roundup, and this one coincides with a notable first-year anniversary: that of Google’s $1.65 billion acquisition of YouTube, confirmed on October 9th, 2006.

Since then, the name “YouTube” has become virtually synonymous with “online video sharing”. According to Comscore, the website maintains a sizable lead over competitors with 205,593,000 unique visitors per month. Second-place Yahoo Video trails with 48,026,000 visitors. But must YouTube remain the clear winner in the online video space? While they have certainly captured the largest audience – which may in the end be all they had needed to do to secure their position – we shouldn’t underestimate the many other companies vying for mindshare.

Even if YouTube remains the destination of choice for the vast majority of consumers, producers ought to take a serious look at the alternative services. They often support more file types, bigger uploads, and higher resolutions. They also place fewer restrictions and provide an array of features simply overlooked by YouTube. That said, a few of these services are mere YouTube clones and hope to follow in YouTube’s footsteps by providing very basic features.

These are the services we looked at: blip.tv, Brightcove.tv, ClipShack, Crackle, DailyMotion, Sony eyeVio, Google Video, Megavideo, Metacafe, Motionbox, Revver, Spike (ifilm), Stage6, Veoh, Viddler, Vimeo, Yahoo Video, and YouTube.

Since they are all about 80% the same, I’m not going to go through each of them one-by-one at length. However, there are some overall trends that ought to be pointed out, as well as some key differentiators. To get into the details as to how all of these websites differ, check out the comparison chart we’ve provided above. You’ll notice that there are some gaps, so please email me if you can help us fill in the holes.

First of all, only YouTube, DailyMotion, and Metacafe appear to place any hard restrictions on video length. With the rest, video lengths are determined indirectly by file size restrictions. While YouTube and several of these sites place the file size cap at 100mb per upload, others place it higher at 250mb, 500mb, or 2000mb. Veoh places no limitations on file size, but they recommend you use their desktop player for files over 100mb. If you’re willing to fork over some cash for a premium membership, Brightcove.tv and Motionbox will also let you upload files of any size.

While YouTube allows users to upload files only formatted as .WMV, .AVI, .MOV, or .MPG, other services accept a much greater range of file types. If you want to make your life easier, however, get into the habit of encoding in .MOV (Quicktime) and you’ll be welcome at almost all of these sites.

When it comes to video quality/resolution, it’s not perfectly clear how these services compare, because most of them don’t state their video bit rates or explain their transcoding processes. However, several of them clearly blow YouTube out of the water. Stage6, a DivX-based service, and Sony’s eyeVio, a Japanese-only service, support the most stunning video quality. Videos hosted by Veoh and Crackle also look very sharp.

Out of all these alternative services, blip.tv stands out as the most professional video sharing solution. The website and player are cleanly designed, they accept perhaps the widest range of file formats, they will automatically syndicate your videos to many other websites, and you can choose to place midroll, postroll, adjacent, and overlay advertisements in your uploads. Additionally, you can track your shows’ statistics quite closely and allow users to download your videos. I could go on and on about blip.tv’s useful features. The only major bummer with blip.tv is that you can’t seek ahead to points in a video using their Flash player.

It’s no surprise that shows like Rocketboom have decided to migrate over to blip.tv. We even decided to use them for our TechCrunch40 conference. And PC World agrees with us that blip.tv tops them all.

While we have a strong preference for blip.tv, the others have their own peculiarities that may make them more attractive to you. ClipShack, while mostly a YouTube clone, has an area where you can use a webcam to add movie, book, video game, and TV show reviews directly to the site. Crackle serves as a talent discovery system through which amateur producers can win a chance to pitch ideas to Sony and other media executives.

Dailymotion, Metacafe, and Megavideo support a wide range of languages. Sony eyeVio, which unfortunately doesn’t plan to roll out an English version, enables users to download videos straight to their PSPs, Walkmans, iPods, and mobile phones. Metacafe and Megavideo both have programs with which they pay content creators according to how many people view their videos. Motionbox, the most private of the services, has a video player with a unique filmstrip that can be used to visually locate segments in a video (they also provide a simple online video editor).

Revver provides a WordPress plugin so that video bloggers can upload and manage their content more efficiently. Veoh lets you both upload videos to other sharing sites and watch videos from all over the Web in its download client. Vimeo sports the best-designed website and a strong community feel. And Viddler’s player packs in a bunch of features, including the ability to leave comments in videos at particular points.

Since embeddable video players are the faces of these services, we have placed screenshots of them below (click to enlarge). We are also in the process of uploading a sample video to each of these websites so you can compare their video qualities. Links to these videos can be found in the comparison chart.

Revver splits revenue 50/50 with video creators after paying 20% off the top for video distributors (sites that embed the video become distributors). This implies total revenue of $2-2.5 million in the last year depending on if there are distributors to be paid. Of course, if they have sweatheart deals with some content providers, that revenue total could be lower, even significantly lower.

Revver was one of the first and currently is one of the few hosted video sites helping monetize social video for independent publishers. Metacafe currently has a producer rewards program where they pay $100 per 20,000 views. Dailymotion and Youtube are expected to pay their users through advertising revenue as well.

These larger investments may be a sign of increasingly competitive times or a desire to take their companies all the way to a public offering. YouTube only raised $11.5 million to reach their exit.

DailyMotion has faired well in the competition for second place amongst video sites. They currently attract 37 million visitors a month. Some of this success is no doubt due to the viewers drawn to pirated content hosted on the site. For instance you can still get complete episodes of The Office. They were also recently found guilty of copyright infringement in July. This is despite implementing Audible Magic’s fingerprinting technology back in June.

However, as others have, they are seeking to clean up their act. When they launched in the U.S., they announced they would seek legal content deals and begin rewarding top content producers. Today’s announcement is more specific, highlighting plans to negotiate deals with makers of music, movies and TV shows. Dailymotion has already signed deals with Universal Music Group and Warner Music Group.

Another French company Blogmusik cleared its record in France, signing a deal to continue streaming music as part of a suspected revenue sharing plan. U.S. based Pandora is still kept from going international because of the webradio royalty rates.