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@DMS: How YouTube Made Money From The Latest Viral Video Sensation

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Say what you will about YouTube and its struggles to make money — but when a video goes viral on the site, there are multiple ways for both Google (NSDQ: GOOG) and the content owners to generate revenue.

Take the JK Wedding Entrance video. The video (which featured Chris Brown’s song Forever), attracted over 11 million views within a week of being posted. That traffic sent the year-old song to the #4 spot on the iTunes chart, and sparked a 20,000 percent increase in album sales on *Amazon*, according to Jordan Hoffner (pictured), Youtube’s director of content partnerships. Correction: The 20,000 spike in sales stat Hoffner gave attendees at the Digital Media Summit was in reference to Monty Python DVDs (as a result of their channel on YouTube), not the JK Wedding clip.

“It was a win-win-win for us, the labels and Apple,” Hoffner said. In addition to running ads against the clip, YouTube got a cut of the track sales through its “click-to-buy” affiliate links — though Hoffner declined to say how big a percentage the video site had negotiated. (The couple in the video got an extension of their 15 minutes of fame with appearances on The Today Show, among other things).

Having those strategic sales partnerships in place was key to YouTube’s success with the JK Wedding clip — deals the company didn’t have linked to the Susan Boyle video (which thus went unmonetized). But the even bigger challenge remains figuring out how to consistently make money off of the less-popular clips (including some UGC), since the bulk of YouTube’s videos only get views in the thousands and ten-thousands.