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article imageYouTube to drop 60-70% of funding for popular channels

By Brian LaSorsa     Nov 12, 2012 in Business
As the wild ride of do-it-yourself entrepreneurship takes off, both Kickstarter and YouTube are still trying to learn as they go.
Launches on the crowd-funding website have increased by nearly 50 percent in the past six months, according to GigaOM.
“Film and video remains the most popular category,” Rani Molla reported, “with more than 21,000 launched projects, or 27% of the total launches in Kickstarter’s 3 ½-year history.”
Since its inception in April 2009, Kickstarter has hosted the launch of more than 77,000 projects, equaling about $409 million. Of this money, 86 percent is invested in successfully-funded ventures while another 4 percent currently consists of live dollars. But the company calculates that only 43.8 percent of projects (non-monetary units) constitute “success.” This wide discrepancy means that many of the website’s successful rounds are either top-dollar requests or over-funded by eager investors.
As Kickstarter continues to seek new business partners, though, YouTube is dropping quite a few.
The video-sharing platform, acquired by Google for $1.65 billion in 2010, plans to pull the plug on at least 60 percent of its channel deals. These channels, which are operated by everyone from News Corp. to Maker Studios, are YouTube’s way of turning the website into a business reflecting the style of actual television.
Jamie Byrne, the Global Head of Content Strategy at YouTube, recently told AllThingsD that executives are primarily concerned with users’ “watch time” and content creators’ cost efficiency.
“We’ve had some really great response from the advertiser community,” he said. “But as we look at this initiative, we are taking the long view here. It’s not necessarily about immediate results.”
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