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September 19, 2006

YouTube Gets More Legit

Looks like YouTube is starting down the path of content legitimacy, inking a deal with Warner Music to legally distribute their content:

' But he said that “our general philosophy is, we want to lead through innovation as opposed to litigation. The user-generated content phenomenon is something we believe is only going to continue to grow and is probably unstoppable. We’d like to be a part of it and make it a great experience for consumers and make sure we and our artists are being rewarded.” '

Now the question is when will the rest of the music and content industry catch up with the thinking above? There has to be a brave soul willing to embrace the user-generated trends of the web's future, and there may be shot-term losses, but the gold is at the end of the rainbow for distributing your content online and sharing in the associated pre- or post-roll video ad revenues. When we will reaching the tipping point and finally realize that Warner Music's deal with YouTube represents the future?

Calacanis has called out YouTube for having created a business (although the company is losing money with it's huge bandwidth costs) based on stolen/pirated content, but this first step towards legitimacy helps answer the debate over which should come first with the next generation of web services companies (Web 2.0): the business plan or the customer/user base.


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