Vessel to take on YouTube with new generation of online video
DetailsJoseph O'Halloran | 18 December 2014
Opening up the service to global creators before official launch in early 2015, former Hulu CEO Jason Kilar has revealed the business plans of the Vessel online video package.
VesselKilar said that fundamentally the new offering would aim to recognise and foster "the explosion of new, talented voices."
"Around the time that my co-founder, Rich, and I started Vessel, we observed that the audiences so coveted by traditional TV were gravitating toward a new generation of digital storytellers," he commented. "Many of these voices have become brands in their own right, building passionate audiences that rival the size of the most popular shows on network and cable TV. Despite the many positive things that the Internet has made possible in media, to date there hasn't been a clear path for most of these talented creators to build sustainable, enduring businesses on the basis of their video storytelling alone. We believe that media can, and should, do much better."
Significantly, Kilar promised to re-write the current business models in place in the online video market.
He argued that at present most creators and content owners put their content on a free, ad-supported web in the hope that they can create a sustainable business. Yet often their reward, in his opinion, was earning low, single-digit dollars for every thousand views their videos generate. He described this level of monetisation, or even five times the current standard, as "extremely challenging – if not impossible" for most creators and content owners to realise their creative and professional ambitions if this is the sole manner in which they release their content.
Kilar insisted that there was also a general end user issue. "Challenging economics constrain which ideas creators can afford to pursue. This means fans may never see a creator's next big idea, or experience it in the way it was originally envisioned. Making things worse, some creators feel the need to graduate to another medium (e.g., traditional television) to make more money, leaving their digital audiences behind. In this process, the creator often cedes control and stops making the content fans want most," he argued.
In contrast, at launch and in its early days Vessel will offer access to short-form videos through what is called a low-priced subscription service of $2.99 a month. This is sustainable through a limited amount of advertising. For those not as interested in early access, Vessel will also offer a free, ad-supported version of the service, where videos become available after their early access period. This claimed Kilar would create a business model that would deliver "unusually attractive" economics for creators. Indeed he calculates that they stood to earn approximately $50 for every thousand views - a rate he said was up to twenty times the levels earned from free, ad-supported distribution. After Vessel's early access period, creators would be able to continue to earn money through distribution of their videos on the free, ad-supported web, on Vessel and anywhere else they choose.
"Free, ad-supported distribution plays an important role in the future of video, and we do not see that changing," Kilar added. "Vessel was created to serve as a critical, missing piece of the puzzle for content creators, with Vessel playing one part among many that collectively help creators achieve their dreams."