TECH TALK: The Rise of YouTube: Success Secret

YouTube co-founder Chad Hurley spoke about how it all began in an interview to Fortune in May 2006: Steve and I were at a dinner party in January 2005, and we were taking digital photos and videos. The next day we found it difficult to share the video files because they were too large to e-mail and it took too much time to get them online. We thought there could be a better way. In February we started developing the product. In May we had our first public preview. And in December we officially launched YouTube. By that time we were serving over three million videos a day. Co-founder Stev Chen added: More important, it’s the community of users themselves. They feel like they’ve built it up, so they want to try to keep it clean. They let us know when there’s content that shouldn’t be there, and we take it down.

What did YouTube do that others did not? A story by Marketwatch captured the essence:

Two things seem to be at work. The first is the incredible desire people have to share video clips with each other. That’s now apparent.
What’s not so apparent, unless you actually have tried to use the various video sharing sites, is that nobody — and I mean nobody — made it easy until YouTube.

By merely combining a pent-up demand with ease-of-use you get the YouTube phenomenon. It’s brain dead simple, but I’m telling you that is all there is to it.

The hardest part of the process is the user managing to get the video onto a computer where it can be uploaded to YouTube. Nowadays with digital camcorders and still cameras that shoot .MOV files it is not that hard and most cams come with software to make it easier.

Then comes YouTube. The first thing you notice about YouTube is the lack of barriers to entry. You can sign up quickly and upload anything in any format right away.

Some argue that YouTube has been built on a platform of copyrighted content that users have put on the site. They believe that any acquirer would have to face lawsuits from the video copyright owners. (In fact, a number of Hindi movies are available in full in chunks because YouTube limits the maximum length of a single clip on YouTube.)

Mark Cuban wrote recently:

Youtube’s rapid ascension to the top of the traffic ranks can be attributed to two and only two reasons:

1. Free Hosting from any 3rd Party site: Hey, why pay for bandwidth for a video if you dont have to ? A blog, a myspace page, an email, any website. Just throw in some html in foots the bill for bandwidth. Sure you are limited by size of file, but so what. Just chop it up into parts 1 through N. Its fast, easy and free. Come to our website and use our video hosting services, we can party like its 1999 all over again !

2. Copyrighted music and video. I dont have a count, but i bet Daniel Powters’ Bad Day is attached to some video snippet of every sporting event ever played , with links sent to fans of every losing team. PIrates season, You had a Bad Day. Spurs vs Mavs. Mavs vs Suns, Mavs vs Heat , Yankees vs Red Sox, etc, etc, etc. Bad Day, Bad Day , Bad Day. If Daniel had a nickel for every time his song was used in a YouTube sports video, he would be a much richer man.

This so reminds me of the early days of Napster.

Take away all the copyrighted material and you take away most of Youtube’s traffic. Youtube turns into a hosting company with a limited video portal. Like any number of competitors out there that decided to follow copyright law.

The New York Times wrote: YouTube says it is different from Napster because it removes content when a copyright holder informs the company of a violation. It points to the Digital Millennium Copyright Act, which in general does not require Internet companies to screen material in advance. Despite these legal uncertainties, YouTube holds obvious appeal for any potential acquirer. Buying YouTube would instantly vault Google to the lead in the business of online video, which is drawing increased interest from advertisers. Its own fledgling offering, Google Video, remains a relatively small player.

Tomorrow: The Future

TECH TALK The Rise of YouTube+T

Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.