Chad Hurley, the co-founder and chief executive of video web site YouTube, opened the Broadband Video Summit at Mipcom in Cannes with a keynote speech that he appeared to be reading for the first time. Addressing the audience at the media market, he said: “We want to continue to be your partner”. YouTube had just announced a major partnership with the Italian broadcaster RAI.
He began by describing a new technology with the ability to entertain and engage people on a massive scale, but with few advertisers willing to risk money on it, while rights holders are reluctant to embrace it for fear of alienating their existing audiences.
This was actually a reference to the launch of the CBS television network in 1941, when people feared that it would mean the death of radio.
Last week YouTube announced a limited deal with CBS, a sister company of Viacom which is meanwhile suing YouTube for breach of copyright.
Every minute, some 13 hours of video are uploaded to YouTube. “That’s the equivalent of Hollywood releasing more than 57,000 full-length movies every week,” he argued, in a comparison that could be considered unwise.
“For those of you wary of this new, decentralised distribution model, understand that the technology exists to give you control,” he said. “If you embrace this opportunity, you will evolve your business model and find new channels and opportunities to deepen engagement, discover new viewers and find new, substantial revenue opportunities.”
The irony is that while the television business is worth over $300 billion a year, YouTube has revenues that were noted as “not material” in a recent filing by Google, which acquired the company for the equivalent of $1.6 billion, mainly in stock. Analysts estimate that YouTube revenues might reach $200 million this year, less than the bandwidth cost for the billions of gigabytes of data it delivers. Google itself now generates revenues of around $20 billion a year.
“From the very beginning, we’ve been committed to working with content owners to make sure YouTube remains a platform for distribution, not unauthorised uploads,” he continued. Over 300 media companies are now using systems like the YouTube Video Identification tool to track copies of their copyright material on the side.
“Gaining control of online video content and discovering effective business models are vital not only for our growth, but for our common survival,” Chad Hurley suggested. “Online video is already fully integrated into the fabric of the Web — its presence is universal, inspiring and empowering to all that embrace it.”
“There is no old media. There is no new media,” he appealed. “There is one media with one common purpose: to inform, move and inspire the world through information, art and entertainment.”