YouTube’s Reign Threatened by a Spotified Revolution, and Other Reel Truths for Video in 2013

thatsallfolksFrom the continued growth of online video to Socialcam and Viddy’s up and down spiral, 2012 was a crazy year for the world of digital video, and I expect it to take a turn for the insane in 2013.

In the past year, we’ve seen several niche social media networks blow up around images, music and ideas — Instagram, Spotify and Pinterest. But what happened in the digital video space? Many mobile video start-ups entered the scene this year, yet despite the increasing demand among consumers for Web video, none of these companies could crack the code on the most critical element of digital video: Discovery. But as content multiplies at an increasing rate, 2013 will finally be the year that the future becomes clear on the next advancement in video.

  • Online video consumption hits a historic inflection point, doubling in 2013
    We are at the threshold of the second digital video revolution spurred by better and more affordable hardware and connectivity. Smartphones are in the hands of nearly one billion across the globe, and tablets, or “the second television,” are blowing up. The iPad alone has climbed the ladder of adoption three times faster than the iPhone and Gartner predicts tablet sales will hit 13 million in 2012, with this number expected to triple by 2016.

    Couple the rapidly increasing penetration of tablets and smartphones with LTE connectivity, and it’s pretty much guaranteed that consumer appetite for video will grow, transforming mobile video consumption into a daily habit. This will ignite a digital video revolution that mirrors the shift from dial-up Internet to broadband. The revolution that happened on desktop years back is about to transpire on mobile, as 2G and 3G are traded up for LTE networks on smartphones. Even with its incredible user adoption, the broadband’s impact on desktop video will pale in comparison to the more accelerated mobile video craze that’s about to kick off.

    In the last three years we’ve seen about a 140 percent increase in the amount of video content viewed online. comScore’s Video Metrix from April 2009 — when total video views hit 17 billion — sharply contrasts with 40 billion videos viewed across Web on November 2012. As consumption of video continues its march from the living room and desktop to smartphones and tablets, I predict that demand, production and consumption of video will double, and video views will hit 80 billion per month by the end of 2013.

  • A newcomer will challenge YouTube for the other half of video consumption
    Declining hardware and distribution costs coupled with a steady increase in consumer demand for video has provoked a huge surge in production of pro and semi-pro video. Because of this increase in more professional-grade video, we have seen a major shift in where people are going to find digital video content.

    People are still watching just as much video — but they are now looking to different sources on the Web. In the past five months there has been a 34 percent drop in the total volume of video consumed on YouTube compared with the rest of the Web. YouTube views peaked in June 2012 at 18.3 billion, but have since declined to 12 billion on November 2012. comScore’s Video Metrix measured total Web video views in June 2012 at 32.9 billion; fast-forward to November 2012 and total video views across the Web hit 40 billion. While YouTube lost about six billion views within that five-month period, the other half of Web video shot up by 13 billion. As online video fragmentation increases in 2013, so will the need for a newcomer that aggregates YouTube and the second half of the Web’s video under one roof.

  • TV networks and the top content creators will be forced into unchartered distribution and economic models
    Big media has seen the rapid shift toward Web and mobile consumption, and sites like, Disney, MTV and CNN continue to produce more online content. Now the real challenge becomes the fight for more audience, monetization and market share. These content creators and their advertisers won’t be satisfied with the results they get within their own silos, and will start looking for a way to expand their reach while still maintaining control over their videos.

    We have seen that relying on social networks like Facebook and Twitter for viral spread is not enough. At Twitvid, we saw major brands with over five million followers post videos to Twitter and receive only a few thousand views. Even major television networks such as CBS and ABC are struggling with this issue. ABC’s Modern Family and Glee, which previously only distributed episodes to Hulu, are now opening distribution to anyone as the effort to reach viewers continues. But no one has found a sustainable combination of large audiences and ability to drive traffic and revenue back to content creators.

    In 2013, studios and networks will be eager to experiment with new disruptive models, and expect to see a new breed of startups that can cater to their desire for both large audiences and strong control over content.

  • All of this will lead to a new opportunity in video discovery that resembles something more like Spotify and less like Instagram
    Digital video is currently plagued by the lack of any real means of video discovery capable of meeting the needs of a social, mobile world. I’m confident that in 2013, someone will solve video discovery through social content aggregation — not just from YouTube, but from the exploding long-tail of semi-pro video. Many have pointed to an “Instagram for video” as the cure-all for the video space’s current state of disarray. But this is much bigger than that. Instagram focuses on user-generated content, which as Socialcam and Viddy proved this year, is not the way to win in the long term. Digital video is insanely larger than just user-generated content. The long-tail of video content is where consumer eyes draw the brands, and ultimately, revenue.

    In the same way that Spotify, Instagram and Pinterest successfully solved discovery for music, pictures and ideas, new models will emerge aiming to figure out a way to tap into this massive new world of video and somehow find a way to weave it all together.

What other predictions do you see for the world of digital video in 2013? Please submit your predictions in the comment section below.

Mo is the CEO and Founder of Telly, a social video network for discovering and sharing the best videos. You can follow him on Twitter @maladham and on Telly.

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