Shield your eyes, kiddies. Google's
The community isn't exactly tickled at the prospect of animated marketing creeping into the clips they're watching.
"This is the end of YouTube," reads one blog response.
"I'm unsubscribing from anyone who has ads in their videos, and if everyone has ads, then I'll just find a site that doesn't," warns another.
You're a monster, Google. You pay $1.65 billion for a poorly monetized video-sharing site. You serve up chunky, bandwidth-hogging flash videos of stoic prairie dogs, sneezing pandas, and lip-synching wannabes. You don't charge for the views or even require user registrations to start streaming on the site.
How could you be so heartless as to actually try to make some of that investment back, and even possibly -- gasp! -- turn a profit?
Slay the beast with a simple test drive
It's not that bad. A sample video shows the InVideo spot in action. Fifteen seconds into a Ford Models hairstyling tutorial, an ad for this summer's theatrical release of Hairspray shows up on the bottom fifth of the screen. It's gone in less than 20 seconds, though a small tab remains in case you want to bring the little ad back up. You can also close the ad while it's running or click on it to bring up a related video ad.
I'll concede that having John Travolta -- in drag -- pop up during a video may be a bit disconcerting, but the ads are pretty unobtrusive. This morning's New York Times describes the ads as "not unlike the tickers that display headlines during television news programs," but that's not entirely accurate.
News tickers take up far less of the viewing screen, they're not translucent, and they're not promotional. Maybe it's just me, but I'd be shocked if I came across a news crawl that read something like:
China faces another lead paint-related recall -- Snickers bar satisfies -- Michael Vick to plead guilty
A better comparison with InVideo is the type of ads you see these days during televised sporting events -- the brief, animated ones popping up in the bottom of the screen to promote another show on the network.
In other words, they're familiar and easy to live with. Compared with most major broadcasters, which force you to sit through annoying pre-roll Internet ads before serving up requested clips, Google's approach is a time-saving blessing.
AdSense, the YouTube way
The most intriguing aspect of InVideo is that Google isn't shoehorning ads into every single video on its site. That may change, of course, but you have to score it a few "do no evil" points since it's giving the content creators the opportunity to decide if it's right for them.
YouTube doesn't have a whole lot of revenue-sharing partners right now. It opened up the program to the community just three months ago, but it is currently accepting only its most popular YouTube video bloggers and aspiring filmmakers like LisaNova, Smosh, and Lonelygirl15. Established partners include seasoned content providers like CBS
The revenue may not amount to much to the individual clip-culture creators, but it's an option that's there for the taking. Since YouTube doesn't provide virtual tip jars on its site, I certainly don't mind the ads. It's money for YouTube. It's also money for the maker of the video that's entertaining me for free.
The problem is that I'm probably in the minority. For some strange reason, way too many Internet users feel they are entitled to free stuff once they float off into cyberspace. Maybe they feel that paying their ISP provider every month opens up a smorgasbord of entitlement online. Folks who would never walk into a store and shoplift a new DVD or CD seem to have no problem with illegal downloads. Folks who have no issue with free television broadcasting ads throughout their favorite shows are supposedly now enraged to see the same thing creep into a site like YouTube.
The challenge for YouTube is simple. It's not about trying to win over spoiled patrons who may have checked their moral compasses at the door. It is about trying to commercialize a site, while many of its competitors watch. Sites like News Corp.'s
A smarter approach
I don't mind the InVideo ads, but I think YouTube is missing the obvious path to profitability here. Display advertising has never been Google's forte. The move to acquire DoubleClick will help address that shortcoming, but Google's strength remains its bread-and-butter AdWords contextual marketing ads. Google can size up a page and serve up a few relevant text-based sponsored spots. Instead of a handful of large companies that can bankroll a video ad, AdWords reaches out to millions of potential advertisers with ad budgets of all sizes.
Working AdWords into YouTube would be a breeze, and it wouldn't have to poke its head into a video while it's playing. At the end of every clip, YouTube begins to rotate a series of thumbnails of similar clips. Replacing those thumbnails with relevant AdWords ads makes sense.
If someone is watching a clip of a dog on a surfboard, AdWords ads can follow for companies that make dog treats, local providers of surfing lessons, or cruise ships with Flowrider surfing simulators.
It works. It makes sense. And no one comes even close to Google when it comes to its deep inventory of text ads.
It is also the kind of revenue-generating tool that can afford Google the luxury of digging deeper into its pool of contributors, allowing even more to share in the revenue pool (while keeping a vigilant eye on the damaging potential of click fraud, of course).
With some clip-culture junkies clearly worried about ads and watermarks creeping into the integrity of video streams, the eventual solution to InVideo may be as simple as OutVideo.
They think you're a monster, Google. Show them that you can be a beast, too.
Here are some of the other recent eye-opening developments at YouTube:
- Hating on YouTube
- Bumping Elbows and Taking Names
- Show Me the Money, YouTube
- Date Yahoo!, Marry Google, Kill Microsoft
Longtime Fool contributor Rick Munarriz finds himself spending way too much time on YouTube, at the expense of spending more time away from the television tube. He does not own shares in any of the companies mentioned in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.