Online video, Internet television, and plebs independent video publishing will undeniably be some of the fastest moving new media sectors. All of them have witnessed many changes, unforeseen innovations, and lots of new fascinating video publishing tools and opportunities in the recent times. For major media companies, and an ever growing list of Web 2.0 video-hosting firms, the best thing now is to sell advertising around video content over the internet.

Online video has totally revolutionized the way we see the ads. In traditional media i.e. TV, a viewer is enforced to see the ads and if incase he switches over to next channel, he again meets head-on with the same problem. This is one of the top-notch reasons for people spending more time on Internet and video sites than the TV set.

The impact of IPTV (Internet Protocol Television) on the marketing and delivery of business services has been now realized by entrepreneurs. And, the video on internet is going to play a crucial role. Internet Protocol Television gives viewers a means to decide ‘when and where’ to watch Web-based video programming. That means viewers can search for video on demand and even build their own custom channels based on their preferences.

Online video advertising is the key differentiator for web companies longing to correspond efficiently their product profile and benefits within the shortest possible span of time. What could be more effective and persuasive than a well designed video message?

Online video publishing has indeed taken the Internet by storm this year and traditional TV channels are loosing ground to it. With the video online, advertisers have a potentially limitless count of distribution channels including thousands of web sites, blogs, search engines, directories and content distribution services that will take your video content (whether it be an ad or not) and run it for targeted audience.

To reap the benefits of online video advertising, many big firms including Google Inc.’s YouTube are drooling at the money that could be made by selling video online. Microsoft chairman Bill Gates at the World Economic Forum in Davos said:

The Internet is set to revolutionize television within five years, due to an explosion of online video content and the merging of PCs and TV sets. I’m stunned how people aren’t seeing that with TV, in five years from now, people will laugh at what we’ve had.

There is no doubt about the saying since people these days like to spend more time on internet rather than TV. If we talk about watching video clips on the net, they seem to be much more interesting and appealing than the documentaries on the TV. Online video is an easy and effective tool to present things on the web and the future is bright for the online advertising. At the moment, YouTube is the global leader in the online video-sharing industry. In this context, YouTube founder Chad Hurley said that the impact on advertising would be profound, with the future promising far more targeted ads tailored to each viewer’s profile.

Well, One of the biggest internet phenomenons of the year 2006 was YouTube that was nominated as the ‘Invention of the Year‘ and was acquired by Google for a whopping $1.65 billion. Now, YouTube founder Chad Hurley is making waves for hinting that YouTube has plans of sharing revenue with users who create and upload the original videos to the distinguished site. The statement was given at the World Economic Forum in Davos on Friday.

Current scenario at YouTube:

YouTube seems to be all set to show us the real meaning of “sharing.” Not only will amateur videographers will get a chance to play with their photography equipments, they’ll get paid for it, too. At this very time, YouTube neither offer any sort of royalties to its subscribers not does it offer the site exclusive rights to them for their videos. Though there are multiple AdSense ad units on the pages and the guys at YouTube are constantly testing new styles but there was no ad revenue sharing mechanism until now.

YouTube’s Revenue Sharing Mechanism:

The new advertising revenue sharing plans might possibly train the way for greater commercial control over content. Chad Hurley cited that the plan is anticipated to “reward creativity.”

Though Hurley didn’t go deep into the details about YouTube’s revenue sharing strategies but it’s obvious that the online video-sharing leader will need to prescreen millions of videos on daily basis. The announcement is enthralling for the creative users but worthless for those who just upload copyrighted content. YouTube is currently working on an ‘audio fingerprinting‘ technology that would help spot copyrighted material.

Hurley further said that YouTube is working out the technology and processes involved - both for the rewards system and the video clip advertising system. Well, full details on sharing ad revenue are yet to be made public.

Revenue Sharing Mechanism from Google’s point of view:

YouTube was acquired by Google for $1.65 billion dollars in November 2006 despite the fact that YouTube had no established revenue model. Since Google paid such a big amount for the deal, YouTube might have felt the utmost need to incorporate ads into videos on to a great extent. Moreover, I appreciate the move to share revenues with members as it will definitely strengthen the community much more rather than being taken as a mere marketing plan.

Presently, YouTube’s official terms say:

You retain all of your ownership rights in your User Submissions. However, by submitting the User Submissions to YouTube, you hereby grant YouTube a worldwide, non-exclusive, royalty-free, sublicenseable and transferable license to use, reproduce, distribute, prepare derivative works of, display, and perform the User Submissions in connection with the YouTube Website.

Now, I doubt that will go for long with the new revenue sharing plan. YouTube will need to exact an exclusive license in return for payment.

Google is sniffing the idea of a three second ad since that won’t infuriate the users thereby making a way for the course to be run through AdSense. Basically, Google’s advertising model is based around the concept of contextual ads. Now, if Google succeeds in unearthing a way to target the ads, it will indubitably act as a bold step in monetizing YouTube.

Moreover, Google has announced that its online video-sharing service would shift focus to search and leave the video sharing to websites such as YouTube.

YouTube’s new model is going to put its competitors in trouble:

Other online video sharing sites that differentiate themselves from the leader on the basis of revenue sharing model, including Revver and Metacafe might soon see their demise as YouTube has a bigger viewership and a good community. Anyway, there are slight chances for Revver to carry along if YouTube doesn’t integrate ads in embedded players in next to no time but Revver will see the same end like others.

YouTube will remain the front-runner in video-sharing industry:

You Tube continues to expand more and more on current Alexa figures as it is in the list of Internet’s top 10 sites on the Web that fetch most traffic. The traffic has grown swiftly from a few thousand to amazingly 30 million visitors in a year. With the new revenue sharing mechanism, YouTube will continue to keep its tight grip on the online video-sharing market.

I decisively believe that nobody will be able to escape the online video and advertising revolution. If we say in context to YouTube, the revolution will not be televised, it will be YouTubed.

Video of Chad Hurley on YouTube:

Image Credit

Via: Telegraph