Will YouTube Soon Produce Its Own Content?

What a potential acquisition signifies for the future of online video

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YouTube is in negotiations to acquire the web video production company Next New Networks, reports The New York Times, signaling that the hub for user-generated clips is poised, for the first time, to produce original video at a professional level. The talks come as Google, which owns YouTube, expands its services beyond computers, rolls out its Google TV software, and increasingly competes with online video services like Netflix and Hulu for viewers and advertising.

Next New Networks, which creates web television shows and supports a network of independent video creators, is responsible for two of YouTube's most popular videos this year: the "Bed Intruder Song," a remixed television interview with Antoine Dodson, who instructs people to hide their kids and wife following an attempted assault on his sister, and "Glitter Puke," a parody of the singer Kesha's "Tik Tok" music video.

Why Is YouTube considering the move? And how will it transform the company and the online video landscape?

  • This Is a Departure for Google, notes Greg Sandoval at CNET. Google has long maintained it didn't want to become a content creator based on the conviction that the digital age rewarded aggregating content more than producing it, he explains. Yet recently TV shows, films, and music have become central to Google initiatives like Google TV, especially as top broadcast networks block Google TV from accessing their content.
  • May Reflect Pressure to Wring More Ad Revenue from YouTube, suggests Andrew Wallenstein at PaidContent. YouTube, "for all its massive size is still largely a home to value-less user-generated content that drain bandwidth costs." Next New Networks is a small company, Wallenstein adds, but Google could face regulatory backlash if it pursues larger video production companies like Lionsgate. He says the decision to buy Next New Networks may be an acknowledgment that short-form content designed for the web is more attractive to users than movies, or may reflect Google's desire to take on minimal risk at a low price.
  • This Deal Makes Sense, says Doug Aamoth at Time: "Short of setting up shop on its own and starting from scratch, [YouTube would] be better off reaching into Google's deep pockets and going after a sure thing like Next New Networks. YouTube has to split advertising revenues with the creators of popular videos already, so why not buy the company that seems to be making the most popular videos anyway and keep that all that ad revenue in the family?"
  • I'm Skeptical, responds Austin Carr at Fast Company: "It's not as if the gain from ad revenue that [YouTube] used to share with Next New will much affect its bottom-line--after all, NNN will continue to produce popular YouTube videos regardless of whether this deal goes through ... Then again, if NNN can rack up tens of millions of views without Google's help, how much traffic could they generate when YouTube features them daily on its frontpage?"
  • People Will Wonder About Bias, adds Marshall Kirkpatrich at ReadWriteWeb: "The question will be asked whether [Google] will privilege [its original] content in its search results, at the expense of the independent producers who helped make it what it is today. That's a question that was asked about Google Knols, the company's competitor to Wikipedia and Google Places vs. other local information services."
  • This Is Great News for Content Creators, remarks Rebecca Lando, who produces a web series for Next New Networks, on her Tumblr: "To create content curated by YouTube? Or even just to know that YouTube is possibly taking a more active interest in higher-end shows, beyond just everyone and their mom flinging webcam rants onto YouTube's servers? I can only see positives from this, for everyone from web video creators to potential sponsors to the audience."
This article is from the archive of our partner The Wire.