October 10, 2006
YouTube Monetizing Mash-Ups By Providing Ad Revenue to Copyright Holders

As I wrote about in my previous post, Google and YouTube have been generating all the discussion this week, but news of the Internet giant's purchase of YouTube has overshadowed an important announcement that came earlier this week regarding YouTube in relation to television content.

In its continued quest to strike a balance between the copyright concerns of property holders and its fame for providing a home for user-generated content, YouTube continues to strike business deals to allow for the distribution of officials shows through the video sharing site. Three networks have announced deals with YouTube to make video available through the popular Web site, supported by advertising revenue that YouTube will split with the content providers.

These three companies are CBS, CSTV Networks and Showtime, as well as record labels Sony BMG and the Universal Music Group.

The plan is to enforce copyright protection that would allow content providers to search the site for offending material and decide whether it should be pulled or allowed to remain on YouTube, thus striking a better balance with the desires of the industry while still washing the company's own hands of the censorship (or violation, depending on how you want to look at it). The plan is considered content identification architecture.

Daisy Whitney with TelevisionWeek writes that "the agreement represents a step forward for YouTube, which has struggled to generate sales and has been mired in copyright disputes with media companies" but also concludes that:

"YouTube's alliances with media companies and its potential acquisition by Google mark a turn for the site, which gained popularity because of its orientation toward the user-generated community and its Wild West reputation. The service's alliances with established corproations may tests fans' loyalty if they perceive a change in YouTube's character."

One of the interesting ideas is that YouTube is monetizing fan mash-ups. As Pete Cashmore points out:

YouTube will share the revenue from any ads placed around those clips. In other words, YouTube is now incentivizing the TV companies to leave their content on the site, even if a user put it there without permission. This is the ideal solution to the copyright problem, and I sincerely hope it works out.

So that begs the question: Will fans view YouTube as a sellout or now as a company that is just trying to create a legal and long-term protected site for user-generated content using copyrighted content? The question will likely be answered in how the company turns its rhetoric into action.



Thanks for the link to Pete's post on this. I wasn't aware of the details when I basically wrote that this is what I expected to see happen. What's important to me is we now may get to see people who upload their videos with someone else's copyrighted music lose out on potential revenue and - while pirating the content for their own purpose - also putting money into the pockets of the corporations they claim to hate.

This is getting fun.