YouTube to Split Revenues With Content Creators Someday

Posted on April 21, 2007

Variety is reporting that YouTube could begin sharing ad revenues with content creators as early as next week. Variety cites Wallstrip founder Howard Lindzon as the source of the information.

YouTube could take an important step toward integrating advertising with its vast library of videos as soon as next week.
Content creators who upload their videos to the site will be offered the option of having short ads shown at the beginning or end, with the resulting revenues split 50-50, according to Howard Lindzon, founder of Wallstrip, a finance-oriented site that distributes videos through YouTube. Key to the new venture will be making sure that those who upload video actually own the rights to it -- which has been a vexing issue in the past for YouTube, now part of Google's Silicon Valley empire.
YouTube didn't respond to several requests for comment.
"It's not surprising at all," said Josh Bernoff, a digital media analyst at Forrester Research. "A revenue-less YouTube wasn't going to last."

It will be interesting to see whether YouTube goes with pre-roll ads that might annoy viewers or whether they will choose to display ads at the end of the videos. Before YouTubers get too excited a post on PC World says that Howard Lindzon denies the quote from Variety about YouTube launching ad sharing next week but he did say "that he believes the ads are coming at some point." PC World also offers this official line from Google/YouTube.

Here's the official line from Google/YouTube: "We are actively exploring a variety of ways to help the community to monetize content, and expect to announce something in the coming months that users will embrace," a spokesperson said Wednesday afternoon. "We will not comment on further speculation on programs we haven't yet announced."

OK. So, nothing has really changed. We already knew ads were coming to YouTube eventually because Chad Hurley announced it at the World Economic Forum in Davos. The Variety article also has another nugget of information about a tool YouTube will soon be offering to copyright holders called Claim Your Content.

YouTube co-founder Chad Hurley, who from the company's start resisted the idea of integrating anything that felt like a commercial, first mentioned the possibility of inserting ads into videos in January.
Google CEO Eric Schmidt, speaking at the Web 2.0 Expo in San Francisco, alluded to advertising as one way that YouTube might cuddle up to previously hostile copyright holders. He called YouTube "a wonderful place for people to take copyrighted information, and, with our support, build ad-supported businesses."
To help copyright holders keep off the site content they don't want there, Schmidt said a new tool, Claim Your Content, would soon be available.

The content claiming tool may not be enough to please some of the entertainment and media companies that want YouTube.com to pre-filter copyrighted videos from getting onto YouTube's website in the first place.