The New York Times reported an update on the YouTube business model in:
The NY Times states:
"SciShow is one of the 100 or so “original channels” that YouTube announced in October. And those new channels — which for the first time are receiving money upfront from YouTube, rather than just a share of advertising revenue — have been seen as this video site’s first major effort to take on the television industry, and television-and-film-based competitors like Hulu and Netflix, for advertising dollars. With regular weekly shows and viewer-friendly playlists, they are indeed slightly more televisionlike than the millions of mostly homemade videos that surround them. But the harder they try to resemble television, the less interesting they are.
About 60 channels are active, and during a week spent rooting among them like a truffle hog in the YouTube forest, I unearthed more than a few tasty morsels."
It terms of advertising dollars, the NY Times states:
"There is also a sameness to them, despite statements by Robert Kyncl, the YouTube executive in charge of global content, about the importance of tailoring offerings to ever-smaller niche audiences. As you click from Red Bull (sports) to Young Hollywood Network (pop culture) to Noisey (music) to American Hipster (just what it sounds like), what’s striking is how they start to blend into one another. They all seem pitched toward the same mythical viewer, presumably the one prized by Internet advertisers, whose mind appears to be occupied with a sticky mix of celebrity gossip, blockbuster movies, video games, zombies, action sports and news of the weird."
Francesco Rulli, CEO of Film Annex commented in response:
"YouTube is the leading platform for user generate content (low quality home videos with minimum or no editing). The bandwidth and hosting costs are so big that YouTube always struggled to produce revenues, and YouTube is so big that it's virtually impossible to imagine it outside of the Google umbrella.
Could YouTube stand alone? The answer is NO, unless they change their current business model and focus more on quality and less on quantity. 100 Channels is a noble intention but it really is a marketing move to change the perception of YouTube as THE user generated content platform of the world. 100 channels is a drop in the bucket! TV has 99% professional content, YouTube has 99% user generated content, Film Annex has 100% professional content."
Growing Film Annex to 30,000 professional videos and 281,000 users took 6 years. YouTube will need to make a huge shift in the business model.
More to come....