March 23, 2007
YouTube Reaches Critical Juncture
Industry experts aren't ready to announce its demise, but say the online video company needs to revamp its strategy quickly. The Washington Post reports.
"YouTube has suffered a one-two punch in the past two weeks.
First, Viacom asked for $1 billion in a lawsuit against YouTube, saying the video Web site failed to remove copyright-protected clips. And yesterday, some of the most powerful businesses in Hollywood and on the Internet joined forces to create an online video site of their own , taking some of the Web's most popular videos with them.
YouTube is at a critical juncture. Since it launched in December 2005, it has ridden a wave of popularity that led Google to buy it in a $1.65 billion deal last year. But now the site must figure out its relationship with major traditional media companies while also forging its business, which to date has relied on advertising posted alongside videos.
The key for YouTube is to find a way to keep traffic coming back to the site even as it finds itself trying to pull copyrighted content as fast as users upload it, said Jennifer Simpson, an analyst at Yankee Group. "As these [copyright] issues are being resolved, it becomes increasingly important for YouTube and Google to find really interesting and compelling user-generated content to attract users," Simpson said."
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