For the owners and shareholders, selling companies with user-generated or community-driven image or video content has been financially very succesful in the past 20 months: Yahoo/Flickr ($17-35 million), Getty/iStockphoto ($50 million), Google/YouTube ($1.65 billion)... .
Michael Arrington over at Techcrunch today reports about the latest rumors on video sharing site Metacafe. The surprise however is not which company might be the purchaser (just yesterday he reported it may be Yahoo, but obviously this rumor is 24 hours later already colder than my coffee) or how high the acquisition price (as usually, no limits whatsover) would be.
I´ve heard so many executives of the companies I cover say "I´m going to buy the next YouTube", said Merrill Lynch analyst Jessica Reif Cohen. "I think there's going to be massive experimentation, and I think it's going to be a very, very, very active deal market."
What is really interesting in Arrington´s post from the perspective of content-licensing content-owners, and not only regarding user-generated content, are his statements (or reported rumors) about the behaviour of the major TV companies:
The major television networks are considering creating a new online video service joint venture to compete with YouTube. [...]
A few major networks want to create a YouTube competitor, and they have been seriously discussing this for months prior to the YouTube/Google deal. The technology is fairly straightforward, and would be based on Adobe’s Flash platform.
The networks would then license their online rights to content to this new service, allowing users to legally watch full episodes of tv shows on the site.
Simultaneous to the launch of this new service, the networks would launch massive litigation against Youtube/Google for copyright violations, forcing them to pull the content off of YouTube. [...]
Insiders put the likelihood of a deal being done at 50/50, and that it’s likely that if they do launch they would buy an existing company to jumpstart things. The most likely aquisition candidate? Everyone keeps saying Metacafe.
Bear in mind though that his blog post is entitled "The Video Startup That May Never Launch".
- More media companies look ripe for buyouts (Reuters, Dec. 02, 2006)
- Update: Media Titans Again Discuss Site to Rival YouTube (WSJ, Dec. 09, 2006)