Peter Kafka

Recent Posts by Peter Kafka

Has YouTube Finally Figured Out How to Play Nicely With Big Media?

roadrunnerYouTube sneaked up on big media, then scared the hell out of them, then tried to do business with them, more or less unsuccessfully.

Now, three years after Google (GOOG) plunked down $1.6 billion for the video site, it seems to have figured out an approach that works for at least some big players: Hand over a chunk of the site to content creators, who get to control it, sell ads on it, program it with their stuff and share some of the ad dollars.

It’s a pretty straightforward compromise: YouTube gets some of the ad dollars that “premium” content–stuff you’d see on a TV screen, basically–can generate; content creators get access to the the gazillion eyeballs that the world’s biggest video site attracts. Examples: See the pacts that Sony (SNE), Disney (DIS), Time Warner’s (TWX) Turner, Warner Music Group (WMG) and Universal Music have hammered out in recent months.

And that sounds like the deal that YouTube and Britain’s Channel 4 have reached. Telegraph:

YouTube and Channel 4 have been in talks for at least the last six months and a contract is expected to be signed imminently. The Telegraph understands that Channel 4 has negotiated the right to sell its own advertising around its content on YouTube and share the revenue with the Google-owned site.

A senior television source close to Channel 4 said: “It was key for Channel 4 to be able to sell the advertising around its own inventory so it could extract maximum value from the deal and retain commercial control over its own property.

“When the Channel 4 content formally appears on YouTube, it will be branded exactly the same way as it is on the Channel 4 website. It will be a fully Channel 4 branded space and look as if someone has picked up 4 on Demand (Channel 4’s online catch up service) and put it on YouTube.”

…The partnership will be the first formal arrangement YouTube has agreed with a British broadcaster in which the majority of its content will be shown in full on the video-sharing site.

No comment from YouTube. If the report doesn’t pan out, I’m assuming it won’t have any impact on anyone reading this in the U.S.: The Web is worldwide, but these content deals tend to be specific to various territories, which means you won’t be able to watch British programming from the States. Fair enough: My non-U.S. readers always gripe about not being able to watch Hulu clips.


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