The following post was written by reknown producer and industry thinker Sjoerd (Sjoko) Koppert. Besides working with bands such as The Who, Pink Floyd, ABBA, Janis Joplin, Frank Zappa, Beach Boys, Yes, and Lynyrd Skynrd, he also orchestrated the launch of FedEx in Europe and the Middle East in 1986 while on a personal break from the music industry. He is well-known for being an insightful and forward thinker for the music industry, as he has constantly adapted his strategies to maintain success in an ever-changing business.
Oniracom is currently working with Sjoko on two original music series, produced in high quality to be premiered on the web before moving to television and film. (More on that soon!) Here’s a snippet on some of Sjoko’s thoughts for YouTube future in their fast maturing market. Enjoy:
Points for thought
After launching FedEx in Europe in ‘86 I attended my first “official” FedEx board meeting in Memphis and caused a lot of consternation. When asked my opinion about the state of the corporation my response was: “Dangerous. You are a single product company in a fast maturing market.” To say this remark caused consternation would be a severe understatement. After all, I was addressing a board that had only ever experienced and accommodated growth. But my statement was truth based on fact and before long they recognized that they had to take serious action in order to preserve their market position.
Today I see a very similar situation with YouTube. They are a single product (delivery platform) company, a market leader in a maturing market. Alternative delivery platforms are developing and growing. Just in recent weeks we have seen developments. Hulu is moving from being just another delivery platform to content development (Article). AOL is moving from content provider to include delivery platform (Article). Shifts have also been spotted from companies such as Yahoo (Article) and MSN/Bing (Article). History has shown that this market movement is to accelerate. As such, a company like YouTube will have to make strategic moves in order to preserve and built its market position.
Currently, we are awaiting YouTube’s response to a request for a more “fixed rate” schedule of advertisements for two original series. This is a move away from their Google based advertising platform. Our request to YouTube is based on our concept research, our proven capability to deliver and the interest in the shows from corporate sponsors.
Our contact with sponsors is due to my history with marketing / advertising / sponsorships, but our core activity is content development. I am a producer first and foremost and a marketing / development person as a necessity. No question YouTube can handle sponsorship / product placement and have the people in place to do so. The latter is one of the reasons I requested for a YouTube person to be part of our “closing team” when finalizing major sponsorship deals. It helps us and comforts our corporate sponsors.
And here comes today’s key question:
YouTube is considering a strategic decision in changing their manner of advertising. Should they perhaps consider a different strategy and partner in the production of shows?
Personally I think of YouTube as a partner anyway, be it an “initial delivery partner” only. I would not have any objections to them becoming involved financially. Yes we would forego a percentage of our long-term revenue, but I do think they have much to offer to counterbalance that. I would value your opinions.
In evaluating the above, please consider that currently our production entity owns both shows and YouTube is the initial delivery platform. After YouTube the shows will go to television and after that other alternative platforms (DVD etc.). In other words, there will be a large ongoing residual value. Naturally we would have to share the revenue with YouTube should they partner us in producing the content.
Do you think this would benefit both parties? Or do you think YouTube should stay away from production and revenue share? I welcome your opinions!