On YouTube hating and loving (or "thread that needle baby!")

Fred calls me and Mark to task for being YouTube haters, and says that YouTube is the “single best thing that has happened to the Net in the past several years.” I wouldn’t argue with that *single* best comment, but in fairness it is right up there with voip, blogging, podcasting, Google Adsense, social software, social news, and broadband.

Who wouldn’t want a free Tivo of the best video moments in the history of filmed media?! That’s not the point.

Fred’s second incorrect statement is that YouTube created the Flash Media player–dead wrong. They didn’t make it Fred, but they did make it a hit.

[ Update: Fred say’s that when he mentioned the embedded flash player he was talking about the syndicated video feature… fair enough. ]

What Fred misses completely (and he doesn’t miss much) is that YouTube’s real invention was *syndicated* video. Up until YouTube folks would block other domain names from using their video because of the bandwidth bills. YouTube bravely (or foolishly if their company had/does run out of money due to bandwidth bills) did was *encourage* users to syndicate their videos and used that syndication as a promotion and a link back. That was brilliant–straight up brillaint.

That concept worked, and that syndicated concept is–I believe–their innovation. Does anyone else know of anyone who did syndicated video before YouTube? I don’t off the top of my head.

Now, my point all along about the YouTube service is that it is Napster on the web with very little else. Rewarding someone with a huge valuation or a huge exit for being a “pirate bay” is a joke, and that’s why the big media companies shut down Napster. They did it on principle, not based on logic. Logic would have told the media companies to buy the company and make it legit slowly. If the music companies they would own iTunes, not Steve Jobs.

Now, the technology behind the site is *easy* to build. Trust me on that one because our team at Netscape built it in a month, and our technology is MUCH better than YouTube’s. The reason is that the technology behind YouTube is Macromedia’s not YouTube’s. YouTube should get very little to no credit for their technology beyond the scalling of the service–which is not that easy (but not that hard either).

In fact, the technology piece is sooooooooo easy that Yahoo, AOL, MySpace, and countless startups have all built their own versions. Why would you pay a $1-2B to YouTube for Technology that costs < $50,000 to make/customize?! That is why companies with scale (aka traffic) like Yahoo, MySpace, Viacomm, and AOL have all created their own services. Only an idiot would pay someone $1b for technology that is a commodity and traffic that is based on their IP!

YouTube does have a great community in a very similar way that Napster and Bittorrent had and have great communities. However, if I had a bar that gave out free (stolen) beer every day I could build a great community as well…. but I digress.

What I will give YouTube a lot of credit for is leveraging mountains and mountains of illegal content to make a huge legal business, and for getting away with this plan for so long. They did show copyright holders of the world the value of their content online, and it’s created great companies like Revver which are coming up with models to pay origional content owners.

So, all credit to YouTube for:

a) syndicated video
b) staying in business this long without getting sued
c) showing video holders the value of their content
d) scaling the service

If YouTube can make the shift from back-alley pirate bay to legit content distributor it will be one of the great bait-and-swith, hit-and-run acts of of all time. Napster couldn’t thread that needle, and I frankly don’t think YouTube will.

If they do I’ll buy those dudes a bunch of beers and congradulating them on being the greatest hustlers of all time (and I mean hustler in Jay-Z sense of the word–respek!).