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Online Video Disintermediation? Not So Fast


With its Sept. 1 issue, Bloomberg Businessweek’s cover story again puts online video platforms in the media spotlight with favorable coverage, proclaiming YouTube to be “Hollywood’s new hit factory.”  This is a decidedly different take from Variety’s own ‘YouTube issue” last month, which suggested that “traditional” film and television sectors may be rendered irrelevant by the continued success of online video.  (DisCo mentioned Variety’s “YouTube issue” previously, noting how an odd anti-Internet op-ed was sandwiched between highly favorable coverage of social media video services.)

Businessweek shows that the disintermediation story doesn’t necessarily apply to all content producers.  As DisCo recently noted elsewhere, established incumbents are not invariably disintermediated by new technology, and the Businessweek cover story bears this out with stories of major online video acquisitions by established Hollywood incumbents.

A telling graphic shows that of the top twenty-some YouTube networks not already affiliated with a major content producer, six more had been recently acquired, or were in acquisition talks with the likes of Fox, Disney, Warner, and DreamWorks.  All told, roughly half of the top-viewed networks have ties established industry players.  Thus, while smaller online video networks are still vying to “be the next Viacom, the next Disney, the next NBCUniversal,” established players are not ready to cede the field.  (This doesn’t mean the era of the YouTube solo artist is over — a tongue-in-cheek caption for the Businessweek cover explains that YouTube user PewDiePie’s 30 million subscribers number 29 million more than that of Businessweek itself.)

All told, the news mag coverage suggests that the “buggy whip maker” narrative may no longer accurately describe content producers, many of whom are rapidly embracing online video as a viable and important market.


Intellectual Property

The Internet enables the free exchange of ideas and content that, in turn, promote creativity, commerce, and innovation. However, a balanced approach to copyright, trademarks, and patents is critical to this creative and entrepreneurial spirit the Internet has fostered. Consequently, it is our belief that the intellectual property system should encourage innovation, while not impeding new business models and open-source developments.