YouTube (s GOOG) came to Los Angeles this week to seek out content partners, pitching them its 3-month-old redesign for premium content. “This was a big strategy change for us, one of the most significant ones to date,” said Jordan Hoffner, the site’s director of content partnerships, noting the site’s new “clean, well-lit” shows page was “the first navigation change in about two and a half years.” Hoffner emphasized online distribution of long-form content as a companion to television, but with fewer ads and the opportunity to get audience feedback.
But television content has not yet been particularly successful on YouTube. According to recent stats from TubeMogul, full-length shows average only 7,407.9 views per episode. Perhaps the TV content the site has secured isn’t high value enough; perhaps it should do more to promote the stuff it can actually run pre-rolls on. For whatever reason, few people look to YouTube to watch TV shows online.
Hoffner’s remarks were the keynote address at NATPE’s LATV Fest, where YouTube is a headline sponsor and also sponsored his speech itself. It’s clear YouTube has a pretty strong interest in reaching this audience.
When we asked Hoffner during the Q&A whether his expectations had been met for premium content viewing, he said, “Momentum is taking more time than we anticipated. But growth is not going down; it’s going up.” Hoffner said YouTube is working with programmers to add more content, promote it and refresh it, but that tweaking premium content presentation is limited by the fact that “the data set is not statistically significant yet.”
YouTube got the short end of the stick in recent negotiations with Disney (s DIS) when it received only short-form ABC and ESPN content while Hulu got a major equity investment and long-form prime-time shows. But YouTube these days isn’t just a repository of skateboarding dog clips; it hosted 3,215 full-length TV episodes at TubeMogul’s last check.
Hoffner said he wanted to persuade content owners to post more episodes of their shows to better enable a search-driven content-watching experience. Where YouTube thinks better monetization come through viewers being able to find whatever they search for, media companies are partial to windows. He also said he encouraged content providers to use YouTube’s player and allow comments on their videos, but he was willing to accommodate if they felt they’d rather not.
The economics of showing television on YouTube, Hoffner said, are appealing. Brand advertisers are used to advertising on this content. Viewers will watch five to seven ad units per hour, and $20 to $40 CPMs are reasonable — plus, there are direct opportunities to drive viewers to buy your other products, he said.
Google’s overall proposition to content owners is that it becomes less important what platform a viewer watches on or an advertiser watches on, as long as it’s the same show. But the attention and dollars are still mostly with television, as it’s still early days, Hoffner concluded. “If you don’t have a television strategy, you’re going to have trouble. You need to have both.”
What about YouTube vs. Hulu? Hoffner acknowledged and praised Hulu’s success, noting, “It’s not surprising because of the cost of delivery that two lead players are owned by bigger companies.” But he speculated that the fees the site is paying to license content could eventually hurt its economics. And he jabbed, “We look at it as they’re not delivering the videos from Iran; they’re not delivering videos that bring people together.”