YouTube's New Direction: Retail Distribution of Mainstream Media

YouTube's announcement last week that it will create dedicated pages for advertisers and their mainstream video content marks an important new development in the way video will ultimately be delivered to homes.

My partner and I were discussing this amazing development, whereby a Paris Hilton channel is being created on YouTube in order to publicize her music videos, in hopes of selling her music.

What one has to realize about this is the incongruity of YouTube beating out the entire music publishing industry establishment, not to mention existing online entities such as Amazon, Yahoo and MSN, to become the online "location" of choice for new video content.

In marketing, there is a concept known as the "evoked set." It basically describes how consumers tend to choose a small number of providers of a good or service, perhaps 3-4, among all the potential vendors, that they will actually consider when they make a purchase.

Among all the potential internet URLs one might visit for video content, it appears that YouTube has become part of a very, very large number of consumer evoked sets. Thus, even other media concerns, armed with their "talent," still feel the need to approach YouTube for the online equivalent of shelf space. One assumes that YouTube's equivalent of the supermarket "slotting fee" is a cut of the ad revenues flowing to the channel managers.

One has to simply marvel at how this young company has seemingly joined the ranks, at least in terms of usage and preference, of Craig's List, eBay, and Google as a firm which began as little more than a way for someone to solve a simple online-related problem, without a profit motive per se.

Right now, Amazon, for years a veritable online general store, is essentially out of the picture when it comes to video content destinations. One wonders if Jeff Bezos should have been spending less time on his space exploration project lately, and more on figuring out how to keep his company at the forefront of online content purchasing. While it may not have been thinking of free video content viewing as part of its business model, at least Amazon had an internet address that was second to none. Until YouTube showed up.

Now, even though Google and MSN have video content sections, the relative newcomer is sweeping all before it as media content moguls beat a path to its door. This alone will likely cement its early usage preference among users for the next year or so.

Once again, we see how several companies full of mediocre, uncreative managers can miss an incredible opportunity that practically invents itself. For all the hoopla surrounding media giants such as Time-Warner, GE-NBC, Disney/ABC, and the cable companies, none of them were even remotely close to taking on YouTube.

As my partner and I discussed this recent phenomenon, we mused about how it is changing viewing habits of video content such as television programming. When companies such as Disney began licensing their more popular television programming on a non-exclusive basis all over the place (iTunes, Comcast, their own online site), it clearly gave notice that the days of simple broadcast network delivery are over already.

So now, one wonders what shapes the delivery and viewing of content that used to be associated with broadcast and cable television may take. Some thoughts about that in an upcoming post.