Ovum: danger in ‘over-corporatising’ online video content market


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| 04 February 2016




Digital media needs to recognise that consumers value their role as both viewers and potential creators, and that engagement is one of the most important factors in online video monetisation, says an Ovum research note.



Ovum digital media analyst Matthew Bailey has warned that excessive attempts to monetise online video is getting pushback from audiences, noting that YouTube’s users has react badly to creators’ attempts to own the format.

As evidence of this, Bailey cites Fine Bros Entertainment’s failed React World programme in which it had intended to license the digital network’s React video format, which it had applied to trademark in July 2015, to other online video creators. A subsequent overwhelmingly negative reaction on YouTube and other Internet platforms led to a turnaround from Fine Bros, with the company discontinuing the program, issuing an apology, rescinding all associated trademarks and applications, and dropping previous copyright claims on YouTube in a bid to protect its brand reputation.

Yet despite its action, subscribers to the Fine Bros main YouTube channel fell from over 14 million in January 2016 to just under 13.8 million in the space of a few weeks.

“The React Program went against the unique dynamics of the online video space,” Bailey observed in a blog post. “Online video – and, more specifically, the YouTube platform – has thrived due to the sense of creativity and empowerment consumers are granted ... The social, community-driven nature of YouTube, and other online video platforms, is what makes for such an engaging and personalised experience for both creators and viewers alike. The fact that both parties have historically been able to enjoy this experience for free, however, means that monetising this engagement with online video remains a highly attractive, yet also elusive, prospect. YouTube’s change of tack with its YouTube Red subscription offering is testament to the ongoing difficulties faced by major players on this front.”

Looking forward, Bailey also cautioned that many strategies that worked in the traditional video media space will not only translate poorly to the new digital media ecosystem, but may also face a significant backlash from the very digital audience that they are targeting.