The quest for content
Today Michael Arrington writes in his blog: “Video Sites: Breeding Like Rabbits”, with a slightly evil tone in the headline, but quite some info in the article itself. After YouTube raised millions in VC, more new sites jump the bandwidth wagon and look for business in the Online Video Distribution market. Again, the money is supposed to come from eyeballs, eyeballs you drag to your advertisment on the pages or even in the video itself. Tradebit follows a simliar model, offering huge storage space for a very small dollar. That only works, because we drag (today) over 30,000 unique daily visits to the file detail pages and can grab one or the other advertising dollar by doing so.
The real question regarding the distribution of data for the future is, if that advertising model upholds what it is promising today? Bandwidth became cheap, but still is not available limitlessly for a flat rate. Your costs go up by the amount of bytes you transfer - not as much as a few years ago, but still! The whole business works out, if you REALLY blast up in traffic and convert this traffic into substantial revenue.
New models are required to attract good content (read: good movies), beyond the fun stuff. Real movies with real plots, that is (see Richard Halperns Hollywood Production, for example). With tremendous interest from the Internet users, only low sales are generated. People ARE interested in the movies, but only a low percentage is ready to drop a dollar or two for it. If it all can be done with advertisment? If it all can be done by porting the good old television approach to the net? Like: “you can watch that movie for free, but you have to watch these 8 different advertising breaks while doing so”?
I am not sure, if that is worth the hype, neither do I think the right ideas have been brought up just yet!
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