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YouTube starts to come of age

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23 December 2014

2015 trends: It’s nearly ten years since the first YouTube video, Me at the Zoo, was first uploaded by the site’s co-founder Jawed Karim.

Since then YouTube has become the third most popular website in the world, behind Google and Facebook – where more than six billion hours of video are watched every month.

Despite it’s huge popularity, it’s fair to say that YouTube remains something of an enigma for the TV industry.

That’s essentially because YouTube and TV are platforms for very different kinds of content: YouTube works best for individuals who produce short clips with low production costs, while TV favours more expensive long form programming and is a much more collaborative medium.

YouTube also remains a difficult place for TV producers to make money. It’s estimated that one million hits – a substantial number for a YouTube video – will generate less than £1,000 in ad revenue. And that’s before YouTube takes its 45% cut.

Yet producers recognise that YouTube is a brilliant place to test out new ideas and to showcase content to a global audience.

Barcroft Media CEO Sam Barcroft produces content for YouTube, including one piece – The Only Man In The World Who Can Swim With A Polar Bear: Grizzly Man (pictured) – which has been viewed over 27m times. But his company also makes traditional factual TV. He said: “You can use YouTube as part of your business mix. Am I making a great deal of money out of it? Not really. Does it make people interested in my business? Yes.”

Barcroft said that traditional TV still provides the majority of his company’s income, but that YouTube was a great place to experiment with ideas for TV. 

A YouTube presence is also a useful calling card, which allows broadcasters, brands and other potential clients to see your work.

360 Productions head of development Emma Parkins, who works on science YouTube channel Headsqueeze, said her indie had won business with Microsoft as a result of its YouTube work. “It’s a shop window – people come to us as a result.”

TV execs also recognise that YouTube is where the next generation of talent is likely to come from. YouTubers like beauty vlogger Zoella make content that is watched by millions of young viewers.

Little wonder that major TV players are getting into the act, with many investing in multi-channel networks (MCNs) – companies that work with multiple YouTube channels to help monetise their content and talent.

Disney, for example, bought Maker Studios, home of YouTube sensation PewDiePie, while DreamWorks has  acquired Awesomeness TV, Warner Bros invested in MCN Machinima and Shine Group runs ChannelFlip. Fremantle Media recently invested in Divimove, the largest European MCN, while Rightster acquired Base 79. Expect these deals to start paying dividends in 2015.



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