or What's the future of amateur, user-generated video?
MCPS-PRS Alliance, the group that collects music royalties for artists in the UK, announced it has entered an agreement with YouTube (GOOG) to get paid for playing music clips on the web site in the background of videos.
Overall, the agreement will now allow pieces that can be used on YouTube from over 50,000 artists. As a result, the artists will receive a performance fee when their music is included with a YouTube video clip. Essentially this releases video creators to use music clips in their videos, acting like a waver from PRS.
It will force YouTube to pick up the tab for music being used on the site. That makes me wonder how long that can go on without some type of changes being made.
Will YouTube continue to offer users free upload of artists' music embedded in their videos while paying for it? It won't take long for this to dig them even deeper into the monthly cost hole.
Even though they're starting to monetize a little, this make a higher much higher level of monetization and margins to compensate for the added costs.
ser-generated video is fast becoming a liability in the industry, rather than something useful. With these types of costs being added to the already expensive broadband costs, it does make one question what the future of user-generated video will be.
When YouTube started their recent overlay ads, a lot of people threatened to bring their videos elsewhere. I'm starting to think Google and YouTube hope they do.
With most advertisers still not willing to put their brands next to user-generated video, and no real way at this time to guarantee what it will end up next to, where does that leave these types of videos?
Everybody pretty much knows the free videos have been used as loss leaders, the problem is they're expensive loss leaders. Now they're becoming plain losses, with not much future hope of cashing them in for anything.
I've been wondering for some time now what future of free user-generated videos be. How long will companies be willing to underwrite the non-revenue generating sandbox? How long will they put up with the losses?
While I don't think in the near future we'll see anything drastic happen as far as action taken, we'll probably start seeing the emphasis on quality video and the demand by advertisers for semi-professional and professional video. When people start seeing the financial future connected to higher quality videos, we'll probably start to see the general decline of user-generated video by attrition, as people continue to look for ways to monetize their creations.
The only reason to continue have user-generated video is the hope of converting the traffic into eyeballs for the monetized content. Once the monetized, professional content starts to come to the forefront, people will start to go directly to that content, rather than go to find some low quality amateur stuff.
The newness of amateur, user-generated video will start to wear off has the good stuff eventually starts to become the predominate offerings.
There will be the occasional exception, as some unknown talent is discovered, but overall I think this is the future that we'll live in over the next couple years in user-generated video.
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