Good News, Bad News at GooTube
Lots of news today around YouTube's efforts to get big content providers under agreement to provide their stuff to YouTube. — First, the good news. The BBC has agreed to allow some of their content onto YouTube in exchange for a share of advertising revenue.
Context & Ripple Effects
YouTube CEO Chad Hurley said in January 2007 that the site would move toward sharing advertising revenue with video creators; the BBC's deal with Google-YouTube announced today is the first major-rights-holder test of that promise. Under it, the BBC gets three branded channels — one news, two entertainment — showing short clips, with ad revenue split between the two.
The BBC arrives at this from an established direction: it had already been giving away digital content for free, including free downloads of all nine Beethoven symphonies recorded in December 2006. As splashcastmedia framed the decision, a public broadcaster experimenting with open distribution made YouTube the natural next venue rather than a betrayal of one.
First-order effects
- The BBC gains a legal, revenue-generating outlet on the web's most popular video service, converting what would otherwise be unauthorized uploads of its clips into shared ad income across three official channels.
- YouTube gets its first flagship traditional-broadcaster partner under its newly declared revenue-share model, giving Chad Hurley's creator-compensation pledge a marquee proof point.
Second-order effects
- Other US and international broadcasters now face pressure to sign equivalent ad-revenue deals or watch YouTube audiences form around unofficial copies of their programming.
- Advertisers gain professionally produced, brand-safe inventory inside a user-generated environment, tightening the pricing link between broadcast ad sales and online video placements.
Third-order effects
- If the BBC template holds, the broadcast industry's posture toward video platforms shifts from rights enforcement to negotiated distribution, with platforms becoming primary channels rather than piracy threats.
- Revenue sharing hardens into the default contract between professional content owners and user-generated platforms, defining who captures value when audience attention migrates off the broadcaster's own site.
The trend: Legacy broadcasters are moving from treating video-sharing sites as infringement risks to signing ad-revenue-share distribution deals with them, starting with the BBC's three-channel YouTube arrangement.