Nice piece from Jack Myers today on MAGNIFY -

TODAY'S COMMENTARY by Jack Myers Tuesday, July 25th 2006
Magnify Networks Offers Safe Haven for Ad Placement in User Generated Content

Peer Review Emerging as Essential for Online Video Economics

By Jack Myers

Magazines and cable networks want to better understand how to integrate video into their sites and make their users an active part of the experience.
Analysts and industry insiders are questioning YouTube's financial model and ability to convert its millions of users into profits, much as they once questioned Amazon.com. Reports that major media companies are ready to ante up as much as $1 billion for the company revive images of the Internet bubble when all reason and logic disappeared. YouTube will invariably define a viable business model, but as of today founder Chad Hurley has more interested suitors than paying advertisers.

Although NBC and YouTube finalized a content distribution deal and CBS' CEO Les Moonves made headlines with his highly visible meeting with Hurley at Herb Allen's Sun Valley retreat, Steve Rosenbaum, one of the earliest players in the user generated content field and now founder and CEO of video site Magnify Networks, warns "the user generated content marketplace is incredibly messy and as the market becomes more crowded it gets more messy. There is no way for marketers to find user generated content that's appropriate to advertise against."

Rosenbaum, who produced MTV Unfiltered, the first commercial use of user generated video (along with ABC's America's Funniest Home Videos), argues "if you're a TV network, a branded website or a media buyer, you're asking if there's a way to participate in the user generated phenomenon and assure that everything surrounding your brand is appropriate. Advertisers and agencies, as well as websites, want to know how they can protect their brand so they are not putting up any objectionable user generated content." The challenge facing YouTube is the lack of control over what gets published to the site and how to control the availability of inappropriate content in advertising-supported areas of the site.

To solve that concern, Rosenbaum has launched Magnify Networks, which features a patent pending peer review process that subjects every submitted video to analysis by a selected group of users and by editors prior to it being posted to advertiser-supported sections of a Magnify partner sites. "Magnify Networks provides sites with a human powered scalable video review system that turns an individual web community into a vertical review process," explains Rosenbaum. Magnify is currently beta-testing its product with multiple sites (including MediaVillage.com, the website partner of this publication – see http://mediavillage.magnify.net). Rosenbaum advised Jack Myers Media Business Report he expects to announce several major partnerships in the next few weeks.

Within the next two years, Rosenbaum believes, "there will not be a web community that doesn't have video integrated into its offering. There will be a mix of user generated, professional, repurposed and archived videos of all shapes and sizes," he suggests. "Video is increasingly such a good experience on the web that if any site today says it's text only, I think everyone would roll their eyes. Experiences will be different from site to site, with some sites more appropriate for UGC than others."

Rosenbaum points out that even with YouTube's 35,000 uploads and 70 million views daily, "mainstream viewers have yet to arrive in this space. Anyone who tried to watch dial up video in 1999 has scar tissue related to the experience. Now they have to come back and see it's a completely different experience. There's no download and buffer time and it plays well. People will settle into watching video online as a matter of course."

Rosenbaum, whose career has been focused, perhaps more than any other TV producer, on user generated content (for MTV, CBS News and Barry Diller's Studio USA), believes "adding community reviews and filtering helps rise all boats in user generated and professional video. As people realize they can watch and then make videos and become part of ongoing stories, new business models will emerge. We're receiving calls from magazines and cable networks who want to better understand how to integrate video into their sites and make their users an active part of the experience."

"There is no such thing as good or bad video," he points out. "It's contextually relevant or irrelevant to a specific community. The idea of incorporating user generated content (UGC) on a site should be thought of in the same content as letters to the editor of a magazine or newspaper, Rosenbaum suggests. "They don't publish letters that are inappropriate," he points out. "Allowing submission of UGC doesn't mean you're losing control of your brand, if you're maintaining control over what gets published and what doesn't and giving your users an opportunity to register their opinion and vote."

"The advertising market is still underserved by UGC," Rosenbaum adds. "Even though Madison Avenue loves the idea of the authenticity and passion of niche audiences, they're very aware the environment of UGC is not secure. We built a system that can label every video as advertiser safe by harnessing word of mouth.

Rosenbaum intends to organize Magnify's partner sites into an ad network that will only include videos that have been approved as advertiser-safe and that are being made available with the approval of the rights holders. "When a video gets submitted, each site's community gets to review it and vote. The video will be returned when it doesn't meet the standards of a community. Even after videos are reviewed, an editorial staff checks it out before we include it as part of the Magnify Network. What I hope everyone understands is this offers the power of TV advertising with the targeting and efficiency of the web," he states.

For more information, contact Steve Rosenbaum at steve@magnify.net