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IDEA #9 – Pay-Per-Play Videos (PPPV): The YouTube Differentiator

Pay-Per-Play Videos (PPPV)As I stated in my article for TechCrunch recently, there are 3 parties that need to be compensated when it comes to videos: 1) Content Owners; 2) Content Creators [users that might mash things up to create “original” creations] ;and 3) Publishers (MySpace users and bloggers, etc — people/companies that post a video on their website).

Revver compensates content creators and publishers (“sharers”), but only based on the ad revenue. Flixya is a website that compensates publishers. And as mentioned in the article above, YouTube will soon be compensating based on ad revenue.

But what about the content owners and creators that would like to charge for viewing of their videos — and/or the users that are willing to pay a premium to bypass advertising? iTunes and Google Video are allowing main-stream media to sell their videos per-play/download (i.e. episodes of The Office, Grey’s Anatomy, etc on iTunes for $1.99 each and CSI, Star Trek, etc on Google Video for $1.99 each).

YouTube was the big winner, but Guba, Revver, Metacafe and others are hoping to be the next big winner. I think giving the ability for all content owners/creators to charge for their work at whatever price they want, could be that differentiator.

My proposed company would take a % cut of the revenues from the content creator (thus if they charge $1.99 per view/download — maybe we’d do a 50/50 split and thus collect $0.99 and pay-out $1.00 to the content creator).

So how would users pay for this video content? Either they pay via the proposed business’ website — or they pay within the video itself (thus if I’m on a blog and a video is shared that requires payment, I can stay at the website and pay right through the video itself). So if I pay right through the video itself, there might be potential scammers out there that may replicate how the proposed business’ videos ordering system works — thus I think we’d use a “SiteKey” for each account, much like how Bank Of America does.

How “SiteKey” works — upon account setup, you choose an icon that appears at your account login; if the icon isn’t correct when this system asks you to login, then you know someone might be “phishing” you. I have no clue about the feasibility of this: but if the Flash video is being hosted by our business and displayed on some website, then we’d have a cookie with the user — allowing us to show their icon within the video. Otherwise, our login process might just ask for their username first, then show their icon — if it matches, then they’d enter their password to have the funds deducted from their account.

Funds are either through our own micropayment system; or similar to eBay, we tally their amounts and charge them at the end of the month — this is after a $5 minimum deposit into our system, which allows us to verify their payment information — credit card or PayPal.

Thoughts on this video idea? Do you think people would pay for various videos by content owners/creators (they already are through iTunes and Google Video).

  • http://marlincreek.com Graydon

    That which has been given away for free… makes it harder to get paid for later…

    Sorta like “Why’s he gonna buy the cow if the milk is free?”

    But with that aside… yes, I think that people would pay something for content relevant / interesting / entertaining to them.

    The challenge isn’t how to work the financials… selling videos in process (not technology) is the same as selling pictures online. Photographer uploads, people get to see, they like, they pay, they get a print or the hi-res file.

    The $100 million question is how do you “lure” people into the paying model?

    Leading / Bleeding edge types may go ahead and pay per episode of the current coolest thing and watch it on their ipod or have the setup and understanding to go from the computer to the living room tv…

    But all of the other “normal” people have to be marketed to like crack addicts… start off with some great free stuff, hook them and then make it easy / cheap to get a fix… and then pile on the premium.

    It’s a tight wire balancing act.

    Take a look at America’s Test Kitchen by Cook’s Illustrated. They do a show on PBS (free sample) and they have the magazines (just pay a little to get some more fixes) and then there’s the subscription website (pay some more to get fixes whenever you want) and now they are launching the America’s Test Kitchen pay to view website (pay more to re-live those highs) where you can pay to watch what they put for free on PBS… and the crack addicts will follow. (despite their near spam like constant emailing about sales, but that’s for a different post).

    OK, enough rambling… the point?

    Providing JUST the service to enable a pay for video will be copied over and over… but provide the full support to content creators so that they can go from Drug Lord wanabe to full fledge Kingpin.. that will rock.

    Now for some afterthoughts…
    – the average joe / jan still needs an easy way to take the video from the PC to the TV.. Tivo has that I believe, but we’ll need the cable junkies to build it into their packaged deals (cable + highspeed).
    – The service company that you desire needs to be able to be in the back office so that content publishers can build an online “channel”. I think people would be more willing to subscribe to a channel than to a show. The “channel” can build a following / trust by pre-filtering the crap out.

    Ok, that’s it for now.

  • http://marlincreek.com Graydon

    Sorry, one clarification… yes, I know that in the age of viral marketing, it is possible for a creator to get lots of exposure without going through a “channel” filter. But the majority of people still don’t get into social / tagging / whatever sites… but I believe they’ll go to a station that has multiple creator choices… more likely than they’ll go to Bob’s site and pay to watch his stuff.

  • Patrick Gardner

    hmm… net crack.

    Don’t know about everyone else – but i’m guessing a saturated market isn’t a good one to be the first to start charging in.

    metacafe, youtube, yahoo channels (is it still called that?), livevideo, stickam (yeah it’s a little different but similar still), revver… Lots of people all wanting to be the online video kings.

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  • http://www.edevz.com Vasudev

    Hi
    Im working on the above site.It will contain news,blogs,foreum,jokes ans puzzles…Im lookin at a site monetization technique
    Im based out of India

    1.Is pay per play audio a good option?Does it work in India?Is it genuine?
    2.How can I give my bloggers an option of earning through my website?

    Lokking forward to your suggestions
    Thanks
    Vasudev