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Schmidt: YouTube Monetization = Holy Grail

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In recent months, Google CEO Eric Schmidt has made it a bit of a pet project to comment publicly about YouTube, and especially Google’s need to monetize the site. Of course, when he had to report to analysts and shareholders on the company’s earnings call Wednesday, he wasn’t going to stop beating that drum.

Here are all the good YouTube-related quotes from the call, courtesy of the transcript wizards at Seeking Alpha:

– “On the YouTube side, we are enormously happy with YouTube. YouTube is a cultural and end user success that is far, far greater than we ever expected. On the revenue side, we are working on revenue scenarios and new revenue products. I personally do not believe that the perfect ad product for YouTube has been invented yet. We’ve just brought out some little in-video ads which look very good.”

– “[W]e basically are innovators in advertising and we’ve tried post-roll, pre-roll, in the roll kind of ads. We’re having a great deal of success now with these in-view ads where the ads are essentially in the bottom and embedded inside of the video. That looks like a pretty good winner right there.”

  • “We now have 13 hours of video uploaded every single minute, so as you can imagine, it would take quite a many lifetimes to watch all the YouTube videos. It also gives you the opportunity, of course, to watch video on very specific topics that may be of interest to you.”
  • “Lionsgate marked the opening of the film “The Forbidden Kingdom”, for example, and it had over 4 million video views on YouTube just from that promotion. So that was very exciting for us and for Lionsgate.”
  • “We’ve also had some significant success with gadget ads and gadget video ads are likely to be particularly effective because they allow you to tell a story. If you look, the advertisers that we are working with and the content that we are working with are also using the format differently. As a typical example, the Lionsgate deal which was announced yesterday, Lionsgate works with people who upload segments of the Lionsgate movies that they like and they capture them using our ClaimWare content product, and then they can run ads against them.

    “So again, here’s a community that’s busy making copies that are not authorized of content, and Lionsgate has the good judgment to say rather than go and sue those customers, instead let’s go capture that, show an ad against them and get them even more excited about our content, our other content.”

  • “So we think those kinds of models are sustainable and scalable on the Internet and are likely to be very, very significant sources of revenue. I think it’s axiomatic that a new form — and I view YouTube as a new form of video entertainment — will not ultimately use the old forms to monetize.

    There will be new monetization forms that will go for the new entertainment form, and that’s what we’re seeking. That is the Holy Grail. When we find it or the combination of it, it’s likely to be very, very large because of the scale and scope of YouTube.”