The NYT's Richard Siklos analyzes what the online video wars are all about. In a few words, control and proximity.
... More important than the cold numbers is Google’s insistence that it handle the ad business for video. YouTube has the image of a happy-go-lucky site where anyone can put up videos they like, but it has serious ambitions to take advantage of Google’s proven mastery of unobtrusive, relevant ads in text and make a few dollars in video.
It all comes down to control. The (YouTube) site’s terms of use warn users not to “post advertisements or solicitations of business.” That means that NBC and Fox, which want YouTube’s huge young audience, still post clips there but, for now, ad-free. (Certainly advertising does appear elsewhere on the site, including a product placement for chewing gum last week on the much-discussed Web drama, “lonelygirl15.”) In general, YouTube’s advertising game plan is a very different from Google’s core search business — roughly the equivalent of Google telling people that their Web pages will be included in its search results, but only if they contain no ads on them.
Most strikingly, the News/NBC venture represents a nod to the truisms that, even in the age of consumer choice, proximity matters and audiences are still sheep. For all the Web’s efforts at personalization, from bookmarks to RSS feeds to widgets, having these shows on AOL or Yahoo might still make a big difference in ensuring a broad audience. One Web executive who has worked on the new venture even coined a horrific new oxymoron when he summed up the strategy to me: “exclusive ubiquity.”
THAT’S no different from how media have been marketed and distributed for decades. Nothing makes a song a hit like radio play, nothing matters more to the success of a film than how it does on opening weekend, and nothing ensures the popularity of a new channel like where it sits on the cable dial. And who wins the nightly news ratings can be determined as much by the preceding shows on the schedule than the mix of the news or the anchor’s hair.
Putting your video where people will actually see it on the Web is the equivalent of basic cable distribution or a wide opening at the theater. At least that’s what the folks behind News/NBC are betting on, hoping that more big media companies will climb aboard and give the venture the heft to continue to dictate terms.
The only problem is that, for now, the two-year-old YouTube is far and away the most popular site for video online. And rival start-ups like Joost, from the guys who created Skype, are coming up fast. Clearly, the last breathless press release on the subject has yet to be written.