There are now many kinds of television. Linear TV with stations, networks and catch-up TV, VOD, OTT / SVOD streaming (Amazon Instant Video, Netflix, VUDU and soon HBO)....
And then there is YouTube, $6 billion in revenue (2014).
YouTube is not always mentioned as TV but often as a social media (the second after Facebook). For the time being, YouTube is the first TV website, one of the only ones to show growth last year along with Amazon, Netflix, and HBO Go (cf. chart infra). What all started as a hobby for many YouTubers (uploading user-generated content) is now very professional and lucrative. And since the future of video is mobile, YouTube will obviously increase its market share; it will also take advantage of growing connected TV... (see also, in French, "mcn, les nouvelles voies de la télévision".)
Within YouTube, we have seen the development of multi-channel networks (mcn). An mcn can represent many- hundreds - of partner channels. An mcn works more or less both like an incubator and an ad network.
As an incubator or accelerator, it helps fund new media companies (DanceOn got $4 million in funding from Plus Capital and AMC Networks).
As an ad network, it represents new networks and sells their audiences, keeping part of the money collected through AdSense. It helps creators to monetize their audience.
Most mcns are specialized and many are or will represent competition for the cable TV networks. In the U.S.A., the majority are based in California, taking advantage of a rich media environment, studios and digital "startups", VCs, etc. Among the biggest MCNs:
- Machinima (2000, California): video games (among investors: Google and Warner Bros). 154 million unique viewers, 3.6 billion views per month, half happening on mobile. (Source: Machinima, July 2015).
- DanceOn (2010, California): dance and music. Among investors: AMC Networks.
- Fullscreen (2011, California): "global youth media company", 450 million subscribers. Among investors: Comcast, WPP, The Chernin Group.
- Tastemade (2012, California): for food lovers (among investors: Comcast, Liberty Media and Scripps).
- Collective Digital Studio (2011, California): mainly develops comedies. Investor : ProSieben Sat1 Media AG).
- AwesomenessTV (2012, California): programs for teenagers, like "Runaways", "I.M.O - In My Opinion": 14 million subscribers. Acquired by Dreamworks Animation in 2013.
- Makers Studios (2009, California), acquired by Disney in 2014. 42 million unique users.
- StyleHaul (2011, California). Investors: RTL Group / Bertelsmann (93.6%). Fashion, lifestyle, beauty.
- Whistle Sports with 195 channels targeting young audiences. Investor: BSkyB, $7 million.
The YouTube business model is based on advertising ("free") although they claim they might soon start paid subscription channels based on themed topics as well.
On the advertising side, YouTube has proposed Premium video commercials ("preferred") which are like upfront buying, with audience guaranteed on targets, using Nielsen measurement.
And YouTube keeps innovating: shoppable videos are tested in the UK by the supermarket Asda (Walmart) with its Mum's Eye View channel....
Moreover, there are now tools, like Epoxy, to monetize MCNs audience on social media platforms (social reach optimization, analytics). Bertelsmann and Time Warner invested in the company...
From an advertisers and viewers' point of view, YouTube looks more and more like TV and less and less like the Web. In fact, generally speaking, TV is more and more an online media, the Web becoming the media of TV ("media mediorum"!). Not only is YouTube becoming serious competition for TV networks but it seems to act increasingly as a partner to them in the new TV ecosystem.
|TV websites. Source: survey by RBC Capital Markets, The Hollywood Reporter, October 2, 2014|