As far as professional video content goes, YouTube is still fighting an uphill battle to become a player in the market. Major media companies overall still resist making any deals with them, although some like Oprah's Harpo, PBS, Reuters and Hearst Corp. (NYSE:HTV) have signed on.
In contrast, a number of other video syndication deals have been made, like NBC (NYSE:GE) signing on with MSN (Nasdaq:MSFT) to offer video clips from the Summer Olympics in Beijing. That's going to be a huge traffic generator that YouTube (Nasdaq:GOOG) will have no part in. Viacom (NYSE:VIA-B) has also linked up with MSN to distribute video online, as well as with other smaller sites.
The fact that YouTube is trying to convince people they can pick up great video content through companies other than the big five, reveals there is a concern by them about professional video content on the site. There can be no doubt where monetization of online video lies for anybody, and that's with professionally produced content; at least as far as in relationship to ads go.
From Google's standpoint they know they need to start seriously monetizing YouTube. The reason is because they're a publicly held company. They've been able to get away with a lot because search has given them such a robust bottom line, they can afford to take on things that don't do much for some time. Now that things are beginning to slow down for Google, the time has come when questions will start being asked and pressure being put on to justify the investment in YouTube. They're trying to preempt that by making deals for professional video content.
Whatever way they spin it, they haven't gotten it done yet, and won't for some time to come. If you don't have the major media companies working with you, you don't have professional content of any significance. That's all there is to it.
On the other hand, there's no way the major media companies will make deals with YouTube unless they absolutely had to. Until it's proven Hulu or other initiatives like the CBS (NYSE:CBS-A) audience network work or don't work, there will be no agreements in place.
Another side of this is consumers say they don't care what video player they use, it's being able to watch video where they want and when they want that's important to them. So that's another blow against YouTube, which isn't important as far as "the" place to go for professional video. That's why so many other deals are being made outside of YouTube.
In the end, it's probably still a year or more away before we find out what will happen with the alternatives to YouTube. As a matter of fact, YouTube is really out of the race with professional video content, as far as the really important stuff goes.
If the big media companies can marginalize them through offering their professional content across the web on multiple platforms, and people don't care that much about what web site offers it, they could be left with a user-generated mish mash of video content that continually costs Google a small fortune to host, but can't be monetized. This is a very real possibility, and would be difficult to defend to its shareholders.
That's part of game being played at this time by the big media content providers. They know people will view their professional content wherever its offered, not because they make a deal with YouTube. That's one of the points they seem to be making through their actions.
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