Essay: A Simple Plan to Cash in on One-Hit Wonders

“Dogs on skateboards. Cats playing the piano. Who would want to put their brand next to that?!” It’s the most common refrain in the web video biz.

Well, honestly, I’ve seen much worse on commercial TV, and you have too. And if millions of people are watching Tillman the skateboarding dog (at least 18 million views) and Nora the piano-playing cat (at least 12 million views), isn’t that audience valuable? Why are people so scared of advertising on user-generated content?

YouTube’s daily hits are irregular, and that’s a big part of its charm. You’re not tuning in at 8 p.m. for your favorite show; you’re getting sent a link by one of your friends, clicking on something related, browsing around to today’s top hit, and looking up from your screen half an hour later. According to comScore, YouTube viewers watch an average of 49.7 videos per month on the site. The real action on YouTube on a daily basis is unpredictable — it often comes from first-time uploaders with compelling content that separates them from the pack.

Yet YouTube only shows advertising against videos from its partners. Users are allowed to be partners, but only if they have an established library and audience. One of the top criteria for becoming a user partner is “You regularly upload videos that are viewed by thousands of YouTube users.”

Well, NORA: Practice Makes Purr-fect, for instance, was the first video posted by YouTube user burnellyo, two months after joining the site on Nov. 25, 2006. I don’t know the exact growth trajectory of this talented kitty’s video, but as we’re all aware, when a piece of content goes viral, it comes at you from all directions. Pretty soon even your mom has forwarded it to you. Who wouldn’t want to be in front of a wide-ranging, tuned-in, highly entertained audience? Say you’ve got a new flavor of cat food you’re about to launch — these are your people.

YouTube recently implemented a new program it calls “Buzz Targeting,” in which it tracks hot videos as they grow on the site. It’s an excellent idea, but it’s restricted to partner videos. So these hits from unknowns are eating up bandwidth as they speed around the web, and *nobody* is benefiting from that except perhaps the fame-hungry Nora the cat.

What I would propose — and it doesn’t have to be YouTube — is that someone figure out which videos are zooming up the charts (Vidmeter and ViralVideoChart already do this across the web), and place ads against them. YouTube’s lawyers may be too nervous about leaving the safe harbor of the Digital Millennium Copyright Act to risk any implication that they are “filtering” video, but I don’t think it has to come to that. Here are a few simple steps:

– algorithmically figure out what’s up and coming on the site (YouTube already has this technology for Buzz Targeting)
– look through that narrowed group of videos to make sure none of them are porn or pirated episodes of The Daily Show
– optional step: try to contact the uploader and sign them to a contract
– show ads (perhaps from people who have specifically signed up for such viral hits)
– profit!

P.S. I’m not the only one pontificating about how YouTube could make more money if it were just a little more opportunistic about its ads; Citigroup yesterday predicted revenue of $491 million next year on banner ads alone if the site were to place them on most of its pages. (If not branded banner ads, would it be so bad to use AdSense, the little lines of targeted text that brought your parent company so far?) And Mark Cuban, in his own YouTube-hating way, also argued that YouTube isn’t monetizing enough of its traffic (by comparison to Hulu) in a rant he posted this week.