YouTube director of content partnerships Jordan Hoffner outlined its plans to monetize its content to a B&C conference in New York. YouTube is taking a number of different approaches to build its revenue stream, hoping to capitalize on its market dominance.
The site has struck a number of deals with professional content providers in the past few months, and Hoffner says the company's number one priority in 2009 is getting that content in front of viewers. The vast library of user-generated content (UGC) is the key he says, using the example of a video featuring a skateboarding cat.
"The companies say they want to be away from the cat on the skateboard," Hoffner said, "but it is your friend, because the cat on the skateboard is what gets you your traffic. The trick is, how do you get the premium content in front of the audiences watching the UGC."
One of the ways YouTube is trying to achieve that is through VideoID, fingerprinting software that lets participating content owners remove, track or place ads on their content that can be uploaded by users.
Once viewers find that professional content, YouTube is trying a number of approaches to monetize it. In addition to more standard lower-third ads and ads next to videos, the company is placing a focus on click-to-buy and co-branded entertainment opportunities. As an example, he says that a three-year-old best-of Monty Python DVD set went from being the 10,000 most purchased item on Amazon.com to number 5 a week after the British comedy troupe started posting clips on YouTube, with a referral to Amazon.
"If people want to see the last episode of Ugly Betty they know they can go to ABC.com, but on the other side, we can compete by getting into everyone's old favorite [TV shows] and feature films," he said. "Given the audience and how big it is, do we essentially become the museum of broadcasting? Do you start doing deals for libraries?"
With YouTube's recent deal with CBS, classic episodes of shows such as MacGyver and Star Trek are already available on the site, and Hoffner says more content deals are coming.