Yahoo will be introducing a video platform this summer to compete with a range of Google's services, including YouTube, sources have told AdAge. The Yahoo video platform was first reported on in March and since then, the service's developers have reportedly sat down with video producers and worked to sign deals with content creators.
Displacing or competing against a service like YouTube would not be easy, but Yahoo is making the argument that it will see success because the video platform will offer what Google does not. YouTube may be the most popular video sharing platform, but content creators have long complained about some aspects of the service, providing Yahoo with a way to lure people away from Google's ecosystem.
All About Money
One of the main benefits that content creators will reportedly see when joining Yahoo's video service is additional advertising revenue, as a larger percentage of that will go to them than is the case with YouTube. Google keeps 45 percent of YouTube ad revenue. Yahoo has already started offering either a better percentage or a fixed ad rate, although specific numbers have not been leaked.
A 50 percent or 100 percent higher fixed ad rate is attractive to large channels that have a following capable of supplying creators with hundreds of thousands of views per video. According to video-advertising company Tubemogul, YouTube's average ad revenue is $9.68 per thousand impressions, and Google takes $3.87 of that. On Yahoo's platform, creators could potentially see a greater amount of money each month.
Even if Yahoo's video sharing service was superior to YouTube, with better fixed ad rates and a great uploading and video management system, the service would not be a guaranteed success. There are some aspects of Web sites like Vimeo that make them a great alternative to YouTube, yet no large channels are using them because doing so would almost guarantee less video traffic. There are few things that YouTube isn't doing well, and even live streaming may end up being fixed on the platform with a rumored acquisition of Twitch.tv.
Yahoo seems to understand that its service will be shaky at the beginning. AdAge says that in contract negotiations with content creators, Yahoo has not required video producers to publish solely on its platform. This means that well established YouTube channels could at least test Yahoo's platform before committing to it.
While some of the bigger parts of Yahoo's contracts are superior to YouTube, sources have revealed that certain video publishers are not happy about some of the terms. One of the main issues with the contracts is that Yahoo would own any videos that are published on its platform and then included on Tumblr as well, something that most creators would never accept.