Posted tagged ‘Hulu’

UGC, Web TV and P2P

September 5, 2008

Generally speaking, online video exists in one of three forms: user-generated, online TV, and file sharing or P2P downloads. Each has their ups and downs, but there seems to be an ongoing debate about which form will ultimately be more successful or overtake the other.

Currently, user-generated videos have the lion’s share of Web traffic. P2P sites have run into a series of legal issues and Web TV hasn’t quite figured out its place online yet. But the big question is, will that always be the case? Things like profitability and growth play a big part in determining which will steal the top spot in the way of long-term popularity.

Online Video Traffic Comparison

Here are my predictions:

  1. User generated video from sites like YouTube, Revver and Qik will continue to be the most popular.
  2. Web TV will not overtake user-generated video as the most popular online video content, but will gain some traffic share. However, Web TV sites will maintain the greatest ability to generate advertising revnue for the next several years.
  3. In terms of video, P2P is on its way out. Movie and television producers are realizing the benefit of making full-length content available online and collecting ad revenue, which cuts down on copyright infringement – making P2P downloads obsolete.

Ad firms and traditional film producers are more comfortable with the TV and movie formats, so logic says they will continue to choose the more predictable Hulu for placement over the less familiar UGC sites. In addition, YouTube just cannot find a business model that works. Valleywag has a great post that summarizes the issue.

In addition, user-generated video sites just don’t work the way that Hulu does. Nalts over at Willvideoforfood posted about why professional grade videos seem to flop on YouTube. I’d suggest reading Nalts’ post, but here’s the summary – YouTube and similar sites are built around community. You can’t just post a video, no matter how great it is, and expect users to pick it up and share it. Networks, loyal fans and community “cred” are the currency of UGC.

It’s this sense of community between millions of viewers that will keep YouTube and other video sharing sites on top of the popularity contest for the foreseeable future – despite their inability to make as much money as TV-turned-Web gurus.