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YouTube: What Google CEO Eric Schmidt really thinks

I feel as if I have been traversing the country with Google CEO Eric Schmidt this week!  Yesterday I enjoyed lunch with him during his address to the Morgan Stanley Technology Conference in San Francisco (read my first-hand report in “Google CEO extols $800 billion advertising opportunity”).
Written by Donna Bogatin, Contributor on
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I feel as if I have been traversing the country with Google CEO Eric Schmidt this week! 

Yesterday I enjoyed lunch with him during his address to the Morgan Stanley Technology Conference in San Francisco (read my first-hand report in “Google CEO extols $800 billion advertising opportunity”).

 

I spent this morning over breakfast with him during his talk to the Bear Stearns Media Conference in Palm Beach.

 

All from the comfort of my New York City-based PC!

Over the past two days I have heard Schmidt drill-down on the Google business case for YouTube. I share with you below what Google CEO Eric Schmidt really thinks about YouTube. 

Schmidt’s YouTube vision dovetails with the overall Google belief that the number one search engine is driving inexorable business model transitioning to a new paradigm via cloud computing, targeted advertising and search “metaphors for investing opportunities.” 

Schmidt is confident that the Google one-two YouTube and Google Video punch renders Google invincible on the Internet video front. 

While Schmidt acknowledges that “many smaller sites may host their own videos,” and it is “possible” that they may be competitive, he underscores that it is “not likely.”

Schmidt believes the law is in Google’s favor, the “Power Law Distribution,” that is. With only a small number of online video winners feasible, many other players will be “crowded out,” he confidently puts forth.

Number one search engine Google does not envisage being a video contender among many, however. Schmidt states unequivocally: “We want to be number one,” in video too. 

How does Schmidt aim to retain the title of Internet video king that YouTube co-founder Chad Hurley bestowed upon the video hosting site when it was acquired by Google?

Schmidt not only believes in the power of the law, he believes in the power of “fans,” as in “fanatics.”

When Schmidt approaches a video content company about working with YouTube he begins by underscoring that YouTube has the “fans” that the video producers want to reach, no matter that they are uploading copyright content without authorization. 

Google begins its YouTube pitch to media content owners with an almost ultimatum: Users are going to make copies of your copyright content, so you may as well get used to it and embrace it.

Is Google oblivious to copyright ownership rights then? Of course not, Schmidt is careful to note, by referencing what it deems to be the Google and YouTube rights to host any videos it wants to, thanks to the DMCA. 

What about the Google YouTube “Claim Your Content” plan, is it a copyright protection program? Think of it more as a fast-track to DMCA takedowns, Schmidt suggests.

Schmidt advises that video content companies make it even easier for “fans” to use unauthorized copyright content uploads, instead of trying to deprive them of the content they are “fanatics” about.

What will the video content owners really get out of their “fans” exploiting unauthorized uploads of their copyright content? That is still “unclear,” Schmidt acknowledges. Schmidt is confident, however, that the millions of YouTubers represent “potential monetizable targets.” 

How will the YouTube mainstream video media fans be monetized to the benefit of content rights holders? Google is not worried about that right now.

Schmidt on the Google modus operandi: “Don’t lead with advertising, lead with users.” Schmidt underscores that if a “sustainable eyeball business” is built, there will be no problem in “finding ways of monetizing.” 

What about finding ways to monetize for content rights holders, specifically? While Schmidt put forth that video monetization is a “big project” for Google this year, net future monetization benefits to content rights holders remain Googley “unclear.”

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