Auditude, a video advertising company best known for technology that can identify clients' video content and run ads against it, has raised a $10.5 million Series B funding round from Redpoint Ventures and existing investor Greylock Partners. This brings the company's total funding to $23 million.
Last time we checked in with Auditude, the company had inked a deal with News Corp.'s MySpace and Viacom's MTV Networks to detect both official and user-uploaded MTV content on the social network's MySpaceTV platform. It was seen by many as a savvy antipiracy measure. Since then, Auditude has started powering a broader variety of video ads on MySpace and its MySpace Music product, as well as partnered with Warner Bros. Entertainment. More content deals are on the way, CEO Adam Cahan told CNET News.
"From our perspective, we are looking to work with everybody," Cahan said. "We are trying to tackle what I think is one of the biggest opportunities and challenges on the Internet right now, which is (that) tons of people are watching video, 80 percent of folks out there, and yet very few people are really making a business of this yet."
Redpoint partner Chris Moore will join Auditude's board of directors, which also includes former Facebook executive Owen Van Natta. A member of the short list for the top post at MySpace Music, Van Natta instead took the CEO role at rival streaming service Project Playlist.
Just as Encyclopedia Britannica is moving in the direction of user-based entries, Wikipedia might soon be clamping down on theirs.
Wikipedia is apparently considering instituting a new editorial process that would put better safeguards in place and require all updates to be approved by a "reliable" user. The so-called Flagged Revisions process would allow registered, trusted editors to publish changes to the site immediately. All other edits would be sent to a queue and would not be published until they get approved by one of Wikipedia's trusted team of editors.
The proposal comes in the aftermath of a false entry that was posted by a user, saying Senators Ted Kennedy and Robert Byrd had died after an inaugural luncheon last week.
News.com Poll
On his public discussion page, Wikipedia founder Jimmy Wales said, "This nonsense would have been 100 percent prevented by Flagged Revisions," adding that the system gives the site the flexibility to cover breaking news stories quickly while avoiding some of the shenanigans it's seen in the past.
The German version of Wikipedia has been using the system for a while now (partially since May and fully since August, according to one Wikipedia user). But Wales himself points out one major problem with the German model, citing delays of up to three weeks before edits get approved and go live.
"Our version should show very minimal delays (less than 1 week, hopefully a lot less)," wrote Wales, "because we will only be using it on a subset of articles, the boundaries of which can be adjusted over time to manage the backlog."
Which subset of articles would be flagged and exactly how those boundaries would be set isn't clear from the discussion.
Wales writes in his comments that 60 percent of users who responded to a poll approved of the move. Think Wikipedia's plans are a bad idea? There's time to give your input. Wales has asked people opposed to the Flagged Revisions plan to propose other workable solutions to the problem of wiki malfeasance.
AOL is ending its foray into user-generated video, the company confirmed Monday after a weekend of blog reports. On December 18, its AOL Video Uploads service will officially close its doors.
Users who have videos currently hosted through the service will receive an e-mail this week, and will be given the chance to transfer their videos to AOL's preferred alternative, start-up Motionbox, before December 18. If they don't, their videos will be deleted.
AOL has made a concerted effort to shake off some of its older and less successful properties--Journals, Hometown, and AOL Pictures, to name a few, not to mention the fact that parent company Time Warner plans to spin off its flagging dial-up service--while forging ahead with newer, shinier projects. The company continues to launch new blog titles and beef up its Platform-A advertising product; it's also modified its homepage to bring in feeds from multiple e-mail and social-networking sites.
The Google-owned YouTube remains the overwhelming leader in amateur video uploads.
But AOL's not the only one reworking its service priorities. Earlier this fall, Microsoft announced that it was shutting down its MSN Groups service in favor of starting the new Windows Live Groups, and that MSN Groups would be effectively ported over to social network Multiply.
To some YouTube fans, the Web's iconic video-sharing site may appear to be losing its soul.
Two years ago, YouTube executives disdained anything but the most unobtrusive forms of advertising (no prerolls for them), and even promised to pioneer new ad formats. At the same time, YouTube refused to license rights to TV shows and feature films. Instead, the company bet big on the creative force of the masses to draw huge audiences and eventually advertising dollars. But things didn't turn out that way.
(Credit:
Greg Sandoval/CNET Networks)
In the past week YouTube has announced it will auction off search terms as part of an ad program, called Sponsored Videos, designed to enable anyone to expand the viewership of their videos. YouTube also said last week it obtained rights to post full-length movies produced by a large film studio, Metro-Goldwyn-Mayer. What this means is that YouTube has given up on the idea that user-generated content can be a successful standalone business. It's about time.
Despite all the new found political influence and the kudos for enabling individuals to become their own broadcast networks, YouTube--and rivals--have failed to prove that there's significant revenue in showcasing home movies. A YouTube representative declined to comment.
What's happening now is YouTube is moving out of the T-shirt and sandals phase of the company's evolution and adopting a more buttoned-down approach. Sure, Google should have rolled out a AdWords approach at YouTube a long time ago but the company deserves credit for finally pushing the site to pay its way.
By adding professional content to the site's service and auctioning off search terms, the same strategy that has made Google billions, YouTube hopes it can generate profits, avoid alienating its audience, and remain a free-of-charge video hosting service.
"YouTube is the king of user-generated video and it probably will be for the indefinite future," said Greg Sterling, an advertising analyst with Sterling Market Intelligence. "But I think it's wise for them to bring this professional content in and give people a mix of reasons to come to the site. I would say the introduction of the Sponsored Videos is very important and smart part of their monetization strategy and may be the one that drives the most revenue over time."
The truth is the ability of user-generated content to generate lots of cash has been in doubt for a long time. Most of the video-sharing companies that challenged YouTube two years ago have been restructured or switched business models. The most recent evidence came Saturday when TechCrunch reported that AOL will shutter the company's lightly trafficked video-sharing service, AOL Video Uploads.
Two years ago, there were people who eyed YouTube's success with skepticism, including Barry Diller, IAC's chairman and CEO and one of brains behind Fox Broadcasting. Josh Martin, an industry analyst now with the Yankee Group, was heavily criticized by YouTube after publishing a June 2006 report that predicted YouTube would struggle to squeeze profits out of video sharing because fans would refuse to accept advertising.
But that's exactly what happened.
"Companies are realizing it's nearly impossible to raise money from user-generated video," Martin said Thursday. "I do think both (amateur and professional made) content will continue to coexist at YouTube. They still get significant viewership on the user-generated side but they also need to start making some money."
YouTube paying its way
In the two and half years since Martin wrote his report, YouTube has tried a host of different ad platforms, including overlays, which briefly appear at the bottom of the video player, and ads that appear after the conclusion of a video. YouTube also offered space on its front door where companies could post video ads.
They weren't enough to help YouTube deliver the kind of money that Google expected, CEO Eric Schmidt has said several times this year.
Some analysts estimate YouTube will generate between $200 million to $250 million this year. That kind of money barely registers at Google, which could see revenue of $20 billion this year.
Some of YouTube's troubles generating ad dollars can be traced to the company's reluctance to annoy visitors. The company has always refused to show prerolls, ads that appear prior to the start of a video. YouTube argues that while prerolls make it likelier that an entire ad will be watched, it's also more likely to frustrate viewers.
YouTube's Sponsored Videos has all the hallmarks of the company's attempt to advertise to audiences while not disrupting their viewing experience. When someone bids on a search term, each time a user keys in that term, they will see the most popular videos attached to the term in one column. In a second column, the searcher will see videos offered by the person or company that bought the search terms.
Compare YouTube's approach to a site like MySpace, the nation's largest social network. One of the biggest complaints about MySpace is that there's too many ads on the site, and this may be one reason why rival Facebook is growing faster. Yeah? Well, MySpace said last month that it's on pace to make $1 billion in revenue this year.
Film industry sources told me that YouTube is insisting on a certain ad format for the long-form films found on the site. Some of the studios interested in posting their full-length movies at YouTube want to have the final say on how to advertise to viewers.
Perhaps the time has come for YouTube to be a tad more aggressive.
Fans will understand and grow to accept more ads, predicted Martin in his report two years ago. "Eventually, the paradigm will shift, where viewers accept watching advertisements to support their free video."
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