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Evergreen Content, YouTube, and Money
I went to see Modest Mouse play at Webster Hall on Nov 15th last year. I uploaded four videos I shot that night to YouTube. They've all had at least a thousand views, but one of them, the song Bukowski, has had 2,500 views to date.
I put a vidmeter on this particular video last month and each day I get an email telling me how many people viewed the video in the prior 24 hours. It's always been at least 10 views and some days I get as many as 50 views. The average seems to be around 20 views per day.
It got me thinking about this kind of evergreen content that keeps getting viewed day after day, week after week. What's that worth? To me, to YouTube, to the band?
Let's start with YouTube. Let's say they do implement the 3 second pre-roll and let's say they charge a $2 cpm for a three second pre-roll. Then my Bukowski video could earn YouTube about $15 per year. And I might get 60 percent of that, or close to $10/year.
That's not a lot of money, but if you uploaded four videos of every show you went to and if you went to one live show a week every year, then you could be making $2000 a year off YouTube advertisements. That's enough to pay for the tickets to the shows.
What's this worth to the band? Well if a three second pre-roll is worth a $2cpm, then a four minute video showcasing how awesome they are in concert is probably worth a lot more. Maybe a $10 cpm?
Which means my video is already worth $25 to Modest Mouse and will be worth something like $75 per year. That's more than they made from the ticket I bought to their show.
Interesting to think about.
Comments (10) | Posted March 24, 2007 in Venture Capital and Technology
Comments
very interesting and continues to prove the hypothesis that bands/music companies need to have a razor and blades strategy (i.e. music for free/discounted and make money of the tickets/shows)
one quiggly note, which does not take away from the overall point you are making is, the folks who came to watch the video may have come through google or even while searching for it on youtube. so the total demand for the song is 2500 views or maybe even twice that.
however if everybody went and uploaded thier own video, all that would have happened is that the 2500 views (or 2x2500) get distributed to the other uploaded videos of the same song i.e. the demand will not increase and possibly even cannibalize from each other.
what this essentially means that the value to Modest Mouse of having web video is $75 or maybe even 2-3 times (say a max of $250) per show and not much more than that...
am i thinking about this correctly?
Posted by: nik | Mar 24, 2007 7:56:50 AM
Maybe I'm a Luddite but I have two problems with this.
1) Why should you earn anything from the unauthorised filming of another's creativity?
2) If this model prevailed, gigs would be filled with even greater numbers of people more concerned with recording rather than enjoying the experience!
Posted by: John Dodds | Mar 24, 2007 10:39:18 AM
Apparantly you value your time at zero? How many hours of your time are spent recording and uploading and monitoring traffic, etc.?
You calculated the revenues of your "record and promote the live shows" venture but ignored the expenses -- an oversight I doubt would be viewed well if made in a startup pitch? ;)
Posted by: Grand Egress | Mar 24, 2007 10:48:16 AM
I agree with John Dodds. Presumably such activity is legal under the restrictions of the venue or under ticketmaster today. I imagine that will change very quickly when there is a real revenue stream there-- not that it should necessarily. The Dead, for instance, have long embraced bootlegs of their shows only to their own financial benefit. Also more shows are offering to press CDs of the concert you just saw for you on the way out for ~$10-$15 and mail them to you.
I attended the Decemberists last night in Boston (great show) and think about this-- you can capture the video or audio you want and now upload it straight from your handheld to your blog/youtube/whatever before they even come out to do the encore. You can essentially "broadcast" with a shortish time delay from your phone.
Lastly, as seen on the FP blog, here is what more creative advertising should be like-- this is Snickers (shot in Jeddah, animated in Amsterdam and Kuwaiti pop song)
http://www.youtube.com/watch?v=Om8qMeICnSg
Posted by: swl | Mar 24, 2007 11:00:32 AM
I don't think I would tolerate a three second pre-roll before every video, and I don't think I'm alone. Maybe only the first video... or every fifth video... Perhaps I'm getting caught up in the details of your example, but I think it overstates the opportunity by being too aggressive in advertising in a way that fights the consumer instead of aiding them (like AdWords aids...).
Posted by: Andrew | Mar 24, 2007 12:35:12 PM
Fred,
It's a an interesting change of thought for you (i.e. internet broadcasts of musical performances have monetary, as opposed to just promotional value). However, you forgot about the royalties associated with (digital/Internet) broadcast of this performance.
1) As swl mentioned above, you'd need clearance to record the concert (for audio and/or video) from both the venue, and the band's management.
2) After recording the performance, you'd need to obtain clearance for the content of the footage (songwriters/music publishing)
3) Performance/broadcast royalties: this is the big one for concert footage. There is a variable royalty assigned to live performances: the royalty can cover the entire concert, or may be issued "per song".
4) Digital media royalties (internet broadcast/distribution): This royalty clause may not exist in all artist contracts (especially older, or legacy contracts) however, there's been a feverish amount of re-negotiation in the last 10 years. At this late date, any artist should insist upon a digital media clause -- up front.
Once you've accomplished/completed all this fun stuff, then and (only then) can you calculate the actual (as opposed to intrinsic) value of a clip posted on the Internet. Royalties are paid first -- always.
Since you would be recording the footage of the concert, obtaining clearance is ultimately your responsibility -- other wise you could be held liable for any associated infringement or non-payment of royalties. A straightforward, plain english (albeit simplified) discussion of music royalties is available here:
How Stuff Works: How Music Royalties Work
http://entertainment.howstuffworks.com/music-royalties.htm
5) Last and not least, no matter how "internet positive" an individual artist may be, no matter how "cool" the artist may be with fans taping a concert -- there's always an issue regarding the quality of the recording... I've seen artists cringe/wince/groan at poorly recorded concert footage (by devoted fans and even "professionals"), and block distribution, solely for that reason.
For your proposed model to work, the easiest mechanism would be to establish a clearinghouse for "fan-recorded" footage. This clearinghouse could be easily added to an artist's or record label's web site via a "Did you tape last night's concert? upload your footage here!". The footage could be reviewed for quality, clearances obtained, then the Internet distribution strategy could be determined. Incentives and revenue models could be added at this time, whether they be ad-driven or whatever.
Or the artist can partner with an established services of these services. Someone above mentioned the Grateful Dead and distribution of their concerts. The Dead (as well as many of the other "Jam" bands) have been partnered with Nugs.net (http://nugs.net) since the early/mid '90s. The Nugs folks do an excellent job of recording concerts and making the footage available for purchased download (in multiple formats) usually within 24-48 hours.
Just my .02
Posted by: hello | Mar 24, 2007 3:45:22 PM
A brief follow-up on the "fan-recorded" clearinghouse I mentioned above: many of the US "news" TV/cable channels are already implementing similar features.
Here's a recent article from the CNNMoney.com/TheBrowser blog via Fortune Magazine:
You report. We decide. (And try to sell you stuff.)
http://thebrowser.blogs.fortune.com/2007/03/22/you-report-we-decide-and-try-to-sell-you-stuff/
As in interesting side note, CNN's citizen journalism efforts, the "i-report" are not mentioned in the above article.
CNN's stuff is here:
CNN.com: Exchange/i-Report
http://www.cnn.com/exchange/
Posted by: hello | Mar 24, 2007 6:25:03 PM
This is somewhat related -- wouldn't you love to see all the videos/photos/comments by people ... possibly find out about the people that were at that show (or upcoming concerts)? That's the premise of idea #3 that I'd like to launch at Ringside Startup.
Posted by: Steve Poland | Mar 26, 2007 2:08:21 AM
Please excuse the shameless plug, but I am the Director of Marketing for a startup that offers a video analytics solution called TubeMogul.com where you can group videos and publishers, compare in a single chart, and have your trends exported to excel. The site is free and I'd be grateful if you checked it out next time you need to track a video.
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