YouTube Platform: What Is the “New Deal”?

Today the YouTube Platform launched in Silicon Valley. The new YouTube API allows people to upload, watch, search, and comment on the videos on other websites. That is you can create a web service that has a video sharing feature but the videos are hosted on the YouTube servers. Great! We all want one! Apparently YouTube Partners are already on the bandwagon creating “cool YouTube applications“. The Partner program is US, CA, UK only.

You provide the video, YouTube hosts it, and in turn gets all the ad revenue. As I read from the TechCrunch YouTube Platform post YouTube product manager Jim Patterson confirms that there is no revenue-sharing built into the API. He says:

It is a YouTube-branded experience. It is free. The price you pay for using it is you must participate in the YouTube community.

We heard these before. Lets look at the contract, the immaterial contract between a regular user and YouTube, the immaterial contract written and signed only by YouTube. There are 3 monetization ways for YouTube:

  1. In-video ads displayed in my own video at my own site
  2. In-video ads displayed in my own video at
  3. In-video ads displayed in my own video that is embedded elsewhere on the web

whereas only 1 monetization way for a regular user:

  1. Ads in video pages displayed at my own site

So the new deal is clear: 1 + 1 + n is not equal to 1 + some visibility.

With the new API YouTube massively extends its advertising real-estate, that is every person or web service who hosts videos on YouTube. It must be a clever move in the business literature, but it just increases the value imbalance between the user’s labor and the service’s offer.

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