YouTube Launches Revenue Sharing Partners Program, but no Pre-Rolls
Duncan Riley
32 comments »
The news, first broken by Om Malik and now live on the YouTube Blog, that YouTube has launched a revenue sharing Partners Program for its top content creators is a positive step forward for a service that only made $15 million in revenue last year, despite a purchase price of $1.5 billion.
What is notably missing from the announcement is the inclusion of pre-rolls, or similar in-video advertising inclusions for the new YouTube partners, who include LisaNova, renetto, HappySlip, smosh, and valsartdiary.
We’ve covered rumors about the introduction of in-video advertising previously, in January Steve Poland noted the BBC reporting that the advertising on YouTube may take the form of 3 second pre-rolls, but some 4 months later, still nothing.
That’s where we could leave it, if it weren’t for the fact that not only is YouTube not showing a great ROI for Google financially, but the new Partners Program only goes as far as monetizing the actual YouTube page destination with Adsense units. Whilst not without merit, the new program is limited given the way YouTube content is consumed. The great strength of YouTube from its earliest days has been the use of embedded video on external sites: a large number, if not a majority of viewers will never see the advertising, viewing it only on blogs and forums which if they are running Google Adsense units, do so in a way that does not benefit the content creator.
Red Herring reported in April that YouTube was looking to introduce pre-rolls over Summer, but limited to only premium publisher content. Whilst the premium content is a strong driver of traffic to YouTube, YouTube’s sole focus on it for the introduction of in-video advertising would ignore the long tail of user generated and submitted content that was the real driving force for the site in the days prior to Google and its formal content distribution agreements, and as many would argue still is.
The question naturally is why? Why not roll out the option of in-video/ pre-roll advertising to all YouTube content creators? Whilst advertising may not be welcome by every one, Google knows the advertising market and it can credit much of its financial success to date to its inclusive embrace of content creators: Google Adsense today maintains its clear lead due to the broad expanse of publishers worldwide that have not only embraced the program, but were actually able to participate in it, Yahoo’s YPN remains an invite/ United States publishers only service, and Microsoft AdCenter is…well…there, but doing nothing in terms of embracing the long tail.
If technology is to blame, in that Google still hasn’t sorted out the tech behind the delivery of in-video advertising, you’d then ask why the delay, is this Google’s Panama? Google Video did exist prior to the YouTube acquisition so it’s not like they’ve only had since September to start work on the technology, and given that smaller startups including sites such as Revver can do it…well I guess there’s always the off chance of yet another video oriented acquisition.
I agree, I think they should just roll it out to everyone at once or should have done the monetization of the popular publishers under the hood.
True it may get more interest from others to apply for the partner program, but there is no guarantee of getting accepted.
Contrary to popular belief I’m not sure that this revenue program will appreciably change the quantity or quality of videos on the site, but I’m positive that it will introduce a disruptive influence to the YouTube community.
http://www.ebizmba.com
I wonder if they are also showing the ad in embedded vidoes. there could be a problem with sites who don’t allow ad in embedded videos. ok, myspace has a ad-deal with google, but there are others…
Hi Duncan,
I am convinced that Youtube revenue sharing will not be very appealing to individuals. This company doesn’t really know how to monetize traffic and doesn’t seem to be willing to make “small fishes” earn much.
On our website we have discussed hundreds of ways of monetizing your sites. Feel free to use them if you want: businesshackers.com
p.s. I would suggest using revver and metacafe instead.
Good analysis. It’s easy to share revenue when revenue is virtually zero!
The data point I’d like to see if how many actually monetizable actions on Google results from Youtube visits.
I think its a disgrace…..why is someone’s content worthy of payment and others not? It seems Big Media will do particularly well out of it but few others. Come on YT, be fair to all!
This will create resentment among YouTube stars who aren’t chosen for some reason, further speeding their exodus to Revver (or soon, Veoh.)
Wallstrip.com will be part of the initial program as well.
Duncan,
“Whilst not without merit”
???
Are you also impressed the YouTube boffins produce shows for the telly in colour?
Your humble typist,
-Scott
Does this revenue share deal coincide with the Double Click acquisition? Seems like Google will eventually be able to use some of the Double Click technology and network for “monetizing” these videos?
The comment by Chad Hurley is both inspiring and very entertaining!
Seeing a pre-roll on an embedded video is going to look strange. Especially if the video is on a site that doesn’t lend itself to paid advertisements. Its going to look like a fish out of water. Granted, not every video is going to have an ad tacked onto it as it may not be appropriate but it could cause a division of the true diehard Youtube fans and the corporate mindset.
I can’t wait for YouTube to activate advertising for all members, so we can start to monetize our videos. All the video sharing will follow suit happily. Wonder what type of CPMs we’re talking about for end-users?
This is good news. It is important because revenue sharing will insure more original and creative content. It will be of great help to talented people out there who might not have resources.
cool stuff for video publishers - http://www.thuriam.net/video-publishing.html
Google can’t offer advertising revenue to “all members” until certain copyright issues are worked out. The billion dollar lawsuit with Viacom is *nothing* compared to what it would be if Google was actually making money (and paying money to users) from copyrighted video clips.
The other consideration is that advertising alienates people. Do it wrong and you chase your community away, then Google is left with a $1.65 billion lemon. So it makes sense that they’re treading lightly.
I’d suspect that those are the real reasons for the aversion to advertising, not technology.
Looks like youtube is going the way of PodTech and Reever who has been paying top talent to produce video. Iwonder if the paid users get special front page treatment
I beg you, please stop using “whilst.” As a writer, I’m telling you it’s not necessary.
I like the metacafe - model -
- i mean you shouldn’t make anything until you hit a “producer” level of 10,000+ views.
- I dont think its too smart to - give a “Select” few the “Eleet” money.. without outlining what it takes to become a “Eleet” …
- This is an example of bad capitlism
The question about google lacking the technology to make pre-roll videos is a straw man and kind of silly. They could do it in a second.
The problem is that if they introduced this kind of thing into the homemade videos it would kill the site in no time flat. Users would revolt and go elsewhere and Google is already facing a backlash (”They’re the new Microsoft”).
If they did opt to go that route, however, then it would be clever for them to make this functionality OPTIONAL for users and splitting profits from pre-rolls in a model similar to revver. There are many benefits to this approach but the best one is it allows them to make the case that “users have asked to share in the profits” and puts the onus of “selling out” the community onto the users. If users think it’s greedy to have ads on everything than they can blame eachother, not the company.
As has been mentioned here before, pre-roll ads are only feasible if they can make sure there arent any copyright issues w/ the video. A manual process for checking is obviously not very feasible… perhaps they can at very least flag things like talking heads in a dorm room or “amateur video” as copyright-free based on some sort of video recognition (this last piece is a pie in the sky argument… not sure how possible that is).
I can’t believe it took till comment 18 to mention the lawsuit Not that I’m counting I just didn’t want to be repetitive.
But given that Google’s going to court using not fully tested laws that require them to NOT be making money off pirated content, how the heck could they roll out an automated system that lets everybody in?
That’s an odd thing for any Techcrunch writer or famous blogger to not consider.
I’d love for my show to become a revenue-partner, but how do I get them to sign me up? The YouTube staff seems to be very selective in who they promote on their site. In fact, they’ve refused to feature our videos, even though EIGHTY of our fans have sents emails explaining why we should be featured, and we have 45 unique, exclusive videos on the site right now.
http://www.firesidechats.tv
Well, this is a first step. Models with revenue sharing and AdSense are known already (Flixya, TheVideosense, Infectiousvideos, Magnify.net, etc..). Hope that there will be a place for small publishers and small niches also.
Would someone live with Youtube money aportation…? I don´t think so…