A simplified vision of online video’s future
Cory Bergman January 23rd, 2008
No, there’s not much money out there for independent web video publishers. In fact, Perez Hilton said he only made $5,000 on 25 million video views on YouTube (that works out to a lousy .20 CPM, if my math is correct.) So video producers are starting to look for product placement opportunities, explains this TV Week story.
This is a logical next step for online video, which is still in its infancy. If you ask me, online video will continue to niche down until you can “subscribe” to just about everything under the sun, either to your TV, mobile device or PC. The majority of this video will originate from family and friends — baby’s first steps, etc. — but let’s focus on the other stuff. The most successful “shows,” for lack of a better term, will be passionately loyal to their niche and deliver useful information in unique and entertaining ways. (For example, I’d love a “show” about mountain biking in Seattle that combines crazy hijinks with useful trail information. And shows like these would have serious long-tail benefits). They’ll also be produced on a budget, and many of them, like blogging, will be labor of loves. Now, what’s missing here is two things: 1) an easy way for consumers to discover this content and seamlessly “subscribe” to it on their TVs, mobile devices and PCs and 2) an easy way for advertisers to discover shows that match their needs, and then scale enough advertising and product placement across them, with full back-end accountability. For example, K2 Snowboards should be able to quickly find and traffic video ads/placements across every snowboarding show in the country that meets minimum audience parameters and general standards.
But one thing should be very clear here: like blogging, there won’t be much money in it for video producers. Some will become hits and score some cash, especially if like-minded shows are networked together. But this isn’t Hollywood, by any stretch of the imagination. Thoughts on all this? Please let me know in comments…
5 Comments Add your own
1. Jeremiah | January 23rd, 2008 at 5:04 pm
Much of our usefulness as artists was derived from the scarcity of production tools. In 2008, practically every computer (if it has XP, Vista or OSX….heck, even linux) has some kind of non-linear video production software onboard, albeit in varying degrees of simplicity.
What does an artist do when everybody’s an artist?
I fear your insights are correct, and I fear the form they may take in the future of media. The proliferation of media producers means the cost of products falls…it becomes cheaper for national (or international) brands to advertise, and they can “patronize” content that fits their very narrow requirement band. If the only way to make money is to produce corporate-friendly content…. ya see where I’m going with this?
2. Shakir Razak | January 23rd, 2008 at 8:53 pm
Hi,
They will start as “Labours Of Love”, then people will see that money can be made out of them if you try, so vloggers will produce content explicitely to make money.
Those who done it as labours of love but made no money out of it will then think there’s no point in doing if others are making money, while they’re not, and new people will think there’s no point in even starting if its not going to make money.
Yours kindly,
Shakir Razak
3. Shakir Razak | January 23rd, 2008 at 8:54 pm
Hi,
They will start as “Labours Of Love”, then people will see that money can be made out of them if you try, so vloggers will produce content explicitely to make money.
Those who done it as labours of love but made no money out of it will then think there’s no point in doing if others are making money, while they’re not, and new people will think there’s no point in even starting if its not going to make money.
The best of the crop that do make money will be consolidated, into networks, chasing growth and diversification, after which those authors who’ve got bored or made their money will leave, less people will be employed to produce the same quantity of work, and then……..ClearChannel Micro-Media!
Yours kindly,
Shakir Razak
4. roxy | January 24th, 2008 at 5:15 pm
It seems everyone is jumping on the online video bandwagon. From local TV news to local colleges. It’s a bit odd to me.
I always thought it would just be a social networking thing but …..
I envision sitting on my couch serving the net on my 60 inch plasma, downloading some movies and watching right there. Will I ever need to pay my cable again?
So call someone tell me - why is everyone jumping on the bandwagon so quickly?
5. Safran | January 24th, 2008 at 6:43 pm
The premise of this is all wrong: of course Perez isn’t making money off video. He’s hosting it on YouTube. That’s a free service. He doesn’t have control over pre-roll tied with banner ads or any of the tracking that’s required to make advertisers want your product. He’s paying nothing for video hosting, so naturally he’s getting next to nothing in return.
This always happens in these crazy rev-share deals.
Even at a modest $20 CPM (and this should be $30 - $40), he could be bringing in $500,000 a month in preroll ads. He’s missing out on $6 million in inventory. Now I imagine part of this is due to the fact that he doesn’t own the rights to the videos (not that this stopped him before), but it does not, not, not mean there is no money in online video.
There is no money in giving away your video and hoping someone else will sell it and make you rich.
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