YouTube reimagined by Hollywood

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Reports have been swirling for a couple of weeks (thanks, PaidContent.org) that several powerhouse media conglomerates, including Viacom and News Corp., were considering a joint effort to develop an alternative to YouTube. Such direct-to-consumer efforts haven’t exactly burned rubber in the past under media-company leadership -- think Duet/Pressplay, MusicNet and Movielink -- but this time there’s an intriguing difference. The media companies involved in the talks don’t seem to be doing this to control the flow of their works online. Instead, they’re just trying to make money off of the phenomenon. That’s a fresh breath of reality-based thinking.

Of course, it remains to be seen whether a) the deal actually happens, and b) whether the parties involved balk when someone tries to post a clip they don’t want to promote (say, a clip of Ashlee Simpson’s botched lip-synching on ‘Saturday Night Live’). Unless the site has everything that Internet users are buzzing about, it won’t have credibility. I also wonder what would happen if someone tried to post a prize chunk o’ content from a studio not part of the deal, such as Disney. Will other copyright holders be satisfied by what promises to be, at least initially, a negligible amount of advertising revenue?

The site would obviously want to avoid the legal troubles YouTube is experiencing, including an infringement lawsuit by a Los Angeles news service. In fact, the owners of the new site might want to use real or threatened lawsuits to force YouTube and its ilk to remove all their copyrighted material, making the new site the exclusive source for, say, ‘24’ highlights and ‘Colbert Report’ segments. That might seem appealing from a business standpoint, but it’s a legal minefield: any agreement between the new site’s owners not to cut licensing deals with competitors would probably violate antitrust laws.

To me, though, the main reason for media companies not to try to replicate YouTube or any other online video distributor is that they’ve been poorer judges of the market than many tech upstarts have been. Collectively, they’ve been reluctant to back new business models that embrace what people are doing online, insisting instead on approaches with the least potential to disrupt their offline revenue streams. That’s rational, given the relative amounts of money involved (starting from scratch online vs. multi-billion-dollars businesses offline), but it has also conceded the field to outsiders -- particularly file-sharing networks. If three or four media conglomerates joined forces on a user-generated video site, imagine how many corporate lawyers would have to be consulted on a regular basis. Now imagine trying to get them all to agree. Does that sound like a better formula than cutting a deal with YouTube and hoping it comes up with a better way to monetize its audience?