YouTube Shaking Up Traditional Business & Promo Models
By Jerry Weinstein (from www.mediavillage.com)

Esther Dyson's annual PC Forum conference is always a hot ticket. It's a Renaissance Weekend for the Technorati. Dyson's strength is keeping abreast of trends and sticking her neck out to pronounce what's next. It's no coincidence that the theme of this year's conference - which took place in Carlsbad, CA this past week - was Erosion of Power: Users in Charge.

The theme could not be more timely. Sure, we hear the drumbeat of consumers moving away from traditional media:

CD sales are down.
Box office receipts - down
Network audiences, down.
Newspaper circulation…down.
The news isn't all dour. Crain's New York Business (see link (1) below) reports that revenues for online content have hit a new record high and according to the Online Publishers Association, the entertainment/lifestyles segment of the marketplace has reached $2 billion, up 15% since 2004, outpacing that of the online dating space.

We live in interesting times.

On the one hand, celebrity has never had such currency. Media consolidation means that there are only a handful of players that own print publications, TV stations, film studios and exhibitors, and of course, record labels.

Me Media: Amateurs Take Control of Online Entertainment
YouTube Shaking Up Traditional Business & Promo Models

By Jerry Weinstein

Esther Dyson's annual PC Forum conference is always a hot ticket. It's a Renaissance Weekend for the Technorati. Dyson's strength is keeping abreast of trends and sticking her neck out to pronounce what's next. It's no coincidence that the theme of this year's conference - which took place in Carlsbad, CA this past week - was Erosion of Power: Users in Charge.

The theme could not be more timely. Sure, we hear the drumbeat of consumers moving away from traditional media:

CD sales are down.
Box office receipts - down
Network audiences, down.
Newspaper circulation…down.
The news isn't all dour. Crain's New York Business (see link (1) below) reports that revenues for online content have hit a new record high and according to the Online Publishers Association, the entertainment/lifestyles segment of the marketplace has reached $2 billion, up 15% since 2004, outpacing that of the online dating space.

We live in interesting times.

On the one hand, celebrity has never had such currency. Media consolidation means that there are only a handful of players that own print publications, TV stations, film studios and exhibitors, and of course, record labels.

Leslie Gornstein AKA E!Online's wizened "Answer Bitch" held forth on celebrity endorsements on her recent podcast. According to Advertising and Promotion: An Integrated Marketing Communications Perspective, 20% of all TV advertising is celebrity-driven. Why? Because the Zeta-Jones' and Haysbert's have what the industry calls "Stopping Power." Amid all the channels and chatter, they Stop your TiVo dead.

But somehow, in the face of this homogeneity, technology has leveled the playing field for users, enabling a paradigm shift from mass media to user-generated content, or what Larry Lessig calls "amateur culture."

2005 was The Year of The Fan. Exhibit A is Lazy Sunday, the Saturday Night Live short, that once uploaded onto YouTube.com by rabid fans, went, as they say, viral. With the hype reinforced by a New York Times feature on the phenomenon, the short was then downloaded over 5 million times in a month.

Just as significantly, the week that NBC pressured YouTube CEO Chad Hurley to take down its copyrighted content - three days before the February 20th debut of its Bravo show Outrageous & Contagious: Viral Videos - there were over a hundred user-created parodies of Lazy Sunday on YouTube.com, signaling a turning point: The couch potato has left the La-Z-Boy!

Now while there is a sea of what's being called memetrackers to describe Web sites that allow users to upload and collaboratively filter or rate content, YouTube's popularity is breathtaking.

Here are some stats for the video-sharing portal, courtesy of ZDNet: YouTube serves 30 million videos a day. Three-thousand files are uploaded daily. They have 5 million unique users per day, and, according to Nielsen/NetRatings, they had 9 million unique users for the month of February.

YouTube thinks it can navigate through the quagmire of the amateur and professional. Going forward, it intends to limit clips to 10 minutes. CEO Hurley thinks he has the winning formula: "We see the power in leveraging it, having people engage with the content, and driving them back to television." To this end, corporate entities such as Dimension Films have begun to upload trailers and commercials. Currently, Scary Movie 4's trailer has been seen 369,142 times in the three days since it's been up, so it appears that the Weinstein Co. is reaching its target audience. Scary 3 had a box office of nearly $110 million. Will this new-fangled medium have any effect on the film's April 14th opening?

Fox Interactive, whose properties includes MySpace.com -- which is still adding one million users a week -- obviously grasps that social software is the Next Big Thing and so its acquisition of the pre-launch NewRoo (see link (2) below) is not a surprise. NewRoo is a memetracker that will allow for user-generated verticals and anticipates a model of revenue-sharing. Specifically, it will allow users to create insta-content in the categories of sports and entertainment.

Memetrackers use computer-based algorithms to scour search engines for content - and in spaces like Digg, Reddit, and VideoBomb, users vote up the best content. There's even a new Web site that combines our thirst for celebrity news (circulation of supermarket tabloids such as InTouch remains robust even as other pubs are shuttering) and news aggregation: WeSmirch.com. While it can't match the catty jibes of Defamer or the aforementioned AnswerBitch, it serves up breaking celebrity news faster than FedEx.

Both Viacom and NBC Universal have also taken notice. While Viacom is leveraging user content through iFilm (more on that below), its acquisition of Neopets is the bigger story. Neopets is the tween zeitgeist, an 11-18 year-old counterpart to MySpace itself. Neopets - think The Sims meets Tamaguchi (electronic pets) with a dash of Pokemon -- is a thriving community of 25 million now run by Nickelodeon prexy Jeffrey Dunn. Variety reported on Wednesday how its wee community members spend two hours a day in the space and are being focus-grouped in the process of caring for their cyber-pets. On March 20th, USA Network launches ShowUsYourCharacter.com - hoping to build its community from the ground up. Thus far it's undifferentiated from any other social network. Can you really build a community around a network?

In the Business section of last Monday's The New York Times (see link (3) below), Richard Siklos described user-content as being part of a "new economic model." He interviewed an editor from iFilm who's running a contest to provide content for VH1's "Web Junk 2.0," while alluding to Yahoo!'s decision to walk back from original programming to user-driven content. Ultimately Siklos' article reflects the industry lament that amateur content would be sub-par. That needn't be. Yahoo! programming chief and former ABC-TV Entertainment president Lloyd Braun's new strategy for Yahoo! shouldn't be seen as a rebuke of original content on the Web, but rather it's another vote on behalf of amateur culture -- leveraging and distributing content from blogs, home-made movies, music, and photography.

The feature failed to foreground the most disruptive shift: curating of content has left the hands of the programmers. Taking a cue from James Surowiecki's Wisdom of Crowds, WE are now the experts. Cyber-support groups are undermining the once God-like status of programming executives. These days, we are as likely to accept guidance from a trusted reviewer on Amazon as we are a Michiko Kakutani front page rave in the New York Times Book Review. It's the end result that drives the equation: Pandora and last.fm, with their computer algorithms seasoned by linguists, are both driving people away from the FM dial - faster than satellite -- to personalized radio stations that are musical nirvana to many.

Just as user-generated content is bubbling to the service, AOL has launched In2TV (see link (4) below) with 1970/80's sitcoms like Wonder Woman, Alice, and Welcome Back, Kotter (notwithstanding news of the Ice Cube remake). The parent of cutting-edge HBO is stuck in the past. It is literally offering its users Yesteryear, rather than recognizing - as their peers have - that the User is now in charge.

Jerry Weinstein also writes the Parry Social "Verge" TV Fanblog at MediaVillage.com.