[…] As I mentioned yesterday in a post about YouTube, the Google-owned video sharing site has been taking a beating by media companies (and the press) lately.  One of the most commonly heard complaints as of late has been YouTube's position of only offering copyright protection services to content providers with whom the company has a business deal. […]

I know how you feel. I felt the same way too when I read about some of the developments you detail in your post. Clearly, the whole Google-YouTube thing is not rolling out the way we might have thought when the deal went down.

But then I thought about it some more and here is what I found…There is plenty of blame to spread around.

In fact, although you could blame Google, I think the lion’s share of the blame should rest with the studios — based on their ignorance, greed and a desire to control forces that are grossly beyond their control.

Hear me out and consider this:

Of all the studio honchos that I’ve read about, only Anne Sweeney, president of Disney-ABC Television, got it right when she said “We want to go wherever our viewers are. Viewers have control and show no sign of giving it back.”

Is she really the only honcho who understands that the viewers are walking away (in droves!) from “traditional” movie, music, and broadcast TV prodcuts? Maybe not. But she does show a refreshingly pragmatic approach to the market.

Seems obvious — there’s no putting the genie back in the bottle. That said, Disney is still taking the ultra-cautious approach, having cut a deal with board director Steve Jobs’ iTunes and not Google. And make no mistake: iTunes represents only 1/40th of the volume of downloaded music — and they’re the Big Dog in the pay-for-play music industry. Hunh.

Makes you wonder what would happen if someone offered non-DRM mp3s for, say, 3 cents each. I think there’s money to be made on that, boys and girls. But the traditional studios won’t do it because they want the Big Score.

In other words, all the other studio heads are still thinking about old patterns and protocols. For example, television networks are used to getting $0.30 and more in commercial advertising revenues per viewer for a hit show.

But the revenues from Google advertising are considerably lower than that: A page eCPM of $1 generates only a tenth of a cent per view in revenue. Multiply that by ten and you still have only a cent. But those fractions-of-a-penny have added up to billions-with-a-B for little old Google.

Yes, yes, I know: the content on YouTube is infringing on copyrighted material. But, paraphrasing Sweeney again, piracy is, in fact, a business model.

But that apparaently is too daring a concept for the studio heads. Not only that — they cannot even acknowledge that a YouTube video ain’t broadcast TV and never will be.

So, I ask you: who really has their head you-know-where?

Bottom line: movie, music and TV entertainment content isn’t worth what the studios think it’s worth — not anymore, not in a Bit Torrent/YouTube world.

In THAT world, I think Google has a better idea of what (and where) the viewers are — and where the money is coming from and how much of it there really is and how to get it.

Anyway, that’s all just my opinion. I might be wrong.

But I doubt it.

To be honest, I agree with a lot of what you’re saying. I agree that the content producers are stuck in the days of yesteryear.

But the problem is that they aren’t going to budge until the bottom line slaps them in the face. Even as we speak, thousands of people are turning off their computers to go sit in front of the television… not knowing that they might be able to watch it online. Even with networks cramming the fact that they have online versions of their television shows available… people still don’t get it.

I think we have to keep some perspective here. Those of us in the technology/internet industry know things that the average user doesn’t. I think we sometimes take for granted the technological and online wonders that we know about. However, the majority of the population doesn’t know about most of them. The millions of people flocking to YouTube are just a small segment of the worldwide video-consuming market. I always think of my parents when I try to decide if I’m looking at things from a typical online user’s perspective.

And I doubt my parents even know what YouTube is.

But they know what network television is. I think we’ll eventually reach a tipping point where the studios have no choice but to follow the masses online. But I don’t think we’re there just yet. We’re certainly moving that way.

But we’ve got a while to go before Google or YouTube or anyone else can bully studios into changing their game. It’s just not going to happen. Not yet, anyway.

But that’s just my opinion, of course. It’s quite possible that I’m wrong. Haha. Let’s hope, for our sakes, that I am.

[…] As usual, LeeAnn Prescott has some great numbers to share from Hitwise.  But I think the missed point behind these stats is that Viacom wasn't the sole driving factor to YouTube.  And when YouTube's content filter kicks in, and thousands of previously available videos suddenly disappear, their traffic will almost have to take a hit.  Maybe not today.  Maybe not next month.  But over time, people will migrate to where the videos are. […]