Devoted to online marketing, viral marketing, and web marketing

With the announcement that MySpace (NWS-A) will now filter video content on their site, they've moved into an area that I think everybody has been waiting for someone to do. It's probably why YouTube (GOOG) has been sitting on the sidelines doing nothing for a long time concerning video-filtering. They've been waiting for someone else to step forward and take the heat.

How they are doing it is licensing digital fingerprinting technology from Audible Magic.

Here's what I think is really happening here. The video-sharing space has been built upon the mashup or blending of content from various places and putting it together to share with others. Of course it has created great interest, viewing and interaction.

Here's the six reasons I believe MySpace is now filtering content:

1. The problem of course is that the majority of that content is copyrighted, which makes originators of the content want to get some compensation out of it; along with their representatives.

2. The second problem is that it was wildly successful. That means that potential new platforms for content are available to creators of content. Which means that if they close it down completely, they could be literally cutting themselves off from huge revenue sources. That hasn't been proven yet, but it's a possibility.

3. Another part of the equation is that advertising dollars are increasingly being migrated to digital content, taking money away from traditional media outlets. Although some of that is saved through their own online outlets; not nearly all of it is.

4. Why not YouTube? They've painted themselves into a corner. It was built upon basic promises of non-interference which really can no longer be kept. They can't even decide if they want to offer a 3-second pre-roll ad on videos.

5. Traditional media companies tried to get something going to compete with YouTube, and they aren't able to even come together on that. There's not that big of a chance that it would do very good even if it did. The problem they have there is that if they fail, it would provide a much stronger bargaining position to YouTube in making deals or in how to present ads.

6. The traditional media companies really don't want YouTube and others like them to fail; contrary to all the beating of the chests and media battles - they would lose a lot if they did.

So back to why MySpace is doing this. I think they're the only ones that could at this time. They're not a YouTube, they're far more an online community. The risks involved with video is far less with them than it is with YouTube. With YouTube that's their whole game.

MySpace has become something of a hybrid company now. They represent somewhat the merging of traditional media and the new media. They are learning to work it together, something that really isn't being done on this scale anywhere else.

Not everyone on MySpace uses video, and it's not the only reason they go there. This makes it much less vulnerable to implementing filtering systems than YouTube would be at this time.

Bottom line? I think this is literally a trial balloon being floated to see what the impact will be upon MySpace, and to get people used to filters being put in place. If there isn't much of an outcry, eventually it will be put into place by YouTube and become part of the way business is done.

Will it work? It shouldn't take too long to find out. People are starting to realize that there's no way that the costs of video online can be absorbed without monetizing it in some way. Even if they do migrate somewere else, how long will that last until costs force the site to be monetized and develop an ad model?

I think all companies involved are going to use the entire experiment that is performed by MySpace to gather the intelligence they need to plan how to go forward. Now they have no clue as what to do.

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