YouTube’s place in the online video ecosystem may soon change dramatically, if a rumored acquisition goes through. The New York Times reported Wednesday that YouTube is in talks to buy Next New Networks. The two companies already have a previously established relationship beyond just distribution, but if they were to merge, such a deal could have major ramifications for YouTube’s relationships with other content providers.
The price YouTube would be willing to pay and other details of the deal are unclear, with the Times saying that no agreement has been reached yet, and YouTube and Next New Networks both declining to comment on “rumors and speculation.” Even unconfirmed, though, the general take on the potential acquisition was largely positive today: The Times pointed out this would be a first for YouTube, representing a major step forward for YouTube’s larger content ambitions, and could also benefit platforms like Google TV.
We got in touch with Howcast, another creator of content using YouTube as a distribution platform, and the company’s SVP of Business Development Alex Allerson didn’t seem worried. “It’s super encouraging,” he said, to see professionally produced content to be valued like this, adding that Howcast wouldn’t mind direct competition from YouTube.
“The pool is very big,” Allerson said, adding that “users gravitate to what they like to see.”
Machinima.com CEO Allen DeBevoise, via phone, also wasn’t concerned, noting that in the cable world, companies like Time Warner serve as distributors while also owning content divisions like HBO. “YouTube has to tread those waters carefully,” he said via phone. “But if you do it right, you have a church-and-state-type separation.”
The deal, to DeBevoise, would show YouTube’s investment in the space, as well as “validation that brands within YouTube really matter.”
Without confirming the deal was actually happening, Rebecca Lando, who produces the shows Working Class Foodies and MSN Film Fan for Next New Networks, commented on her Tumblr that:
As a Next New Creator, this sounds awesome to me. To create content curated by YouTube? Or even just to know that YouTube is possibly taking a more active interest in higher-end shows, beyond just everyone and their mom flinging webcam rants onto YouTube’s servers? I can only see positives from this, for everyone from web video creators to potential sponsors to the audience.
Next New Networks clocked some 1.2 billion video views in 2010, and the company scored the top two spots on YouTube’s list of most-watched videos in 2010, thanks to Auto-Tune the News and Key of Awesome. It has a long-standing relationship with YouTube, one that has already gone beyond straight distribution partner.
Last fall, when its Barely Digital channel launched the music video parody series Key of Awesome, it did so as part of a pilot version of the program that later became YouTube’s Partner Grants. YouTube Partner Grants, which were officially launched this summer, is a system by which YouTube offers cash advances against future revenue the creator would make as a YouTube partner. NNN, in short, created a new series using money borrowed from YouTube.
As YouTube viewership grows, it will depend more and more on the professionally produced content its audience now demands, with viral videos being largely replaced on the most-viewed charts by music videos and shows from Next New Networks and its competitors. Efforts like the YouTube Partner Grant program and other tools to help creators make more polished videos reflect that the company knows the importance of professional-level content, and acquiring Next New Networks would be another step in this direction.
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