Compared To Hulu, YouTube In 'Very Bad' Spot
Blog Maverick , Wednesday, June 18, 2008 12 PM
In a post heavily laden with undertones of "I told you so," blogger Mark Cuban declares that News Corp./NBC Universal's joint venture Hulu "is kicking YouTube's ass" in the revenue department. Of course, midway through the rant, Cuban admits he has no revenue figures to back up his claim, but when you consider both companies' business models, he says signs indicate that where YouTube has massive traffic but an unsustainable business model, Hulu has growing traffic and a very scalable business model.
In the revenue department, Cuban says that Hulu is either stomping all over YouTube or will soon be stomping all over YouTube. Why, because unlike YouTube, the video venture licenses all of the content it distributes, and thus has the right to sell advertising in and around every one of its videos. YouTube only has that right with the small percentage of videos it licenses. For the vast majority of YouTube content, which is uploaded by consumers, the Google video site is forced to hide behind the Digital Millennium Copyright Act, which means it doesn't know what videos are being posted With no control over those videos, YouTube cannot sell ads on them.
Cuban says this means that Hulu has or will have more monetizable video and traffic than the Google video site, especially as it adds more viewers and content partners. Whereas YouTube can monetize about 1% of its licensed videos, Hulu can monetize 100% of its growing inventory. That, he says, "puts YouTube in a VERY BAD spot."
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In the revenue department, Cuban says that Hulu is either stomping all over YouTube or will soon be stomping all over YouTube. Why, because unlike YouTube, the video venture licenses all of the content it distributes, and thus has the right to sell advertising in and around every one of its videos. YouTube only has that right with the small percentage of videos it licenses. For the vast majority of YouTube content, which is uploaded by consumers, the Google video site is forced to hide behind the Digital Millennium Copyright Act, which means it doesn't know what videos are being posted With no control over those videos, YouTube cannot sell ads on them.
Cuban says this means that Hulu has or will have more monetizable video and traffic than the Google video site, especially as it adds more viewers and content partners. Whereas YouTube can monetize about 1% of its licensed videos, Hulu can monetize 100% of its growing inventory. That, he says, "puts YouTube in a VERY BAD spot."
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