Amazon Borrows from YouTube Script, Opens Marketplace to Video Creators

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AmazonAmazon.com has launched a self-serve marketplace for video that lets pretty much anybody upload content and make money off of it. It’s where YouTube meets Kindle Direct Publishing, the Seattle tech giant’s self-publishing service for books.

The launch of Amazon Video Direct, announced Tuesday, highlights Amazon’s knack for breaking down most forms of gatekeeping that have traditionally ruled cultural industries, from books to movies.

Amazon Studios, its movie production arm, already invites wannabe screenwriters to submit their scripts and concepts online. KDP, the self-publishing service, has unleashed countless independent authors, some of whom have been wildly successful.

It’s unlikely that Amazon is looking for a way to dethrone Google’s YouTube, the primary force that makes Google the top online video property, attracting 182 million unique U.S. viewers in February, according to comScore.

But Amazon seems to draw inspiration from YouTube and its endless buffet of content as a way to boost its own video library, which is a critical cog in the Prime membership money machine, with lots of new content it doesn’t have to produce or purchase.

Amazon also mixes in well-tested techniques from its toolbox — a self-service platform that lets content creators decide how to share their content and how to charge for it, while Amazon collects a sometimes hefty toll.

Wall Street appears to have liked the news — or at least it didn’t mind it. Amazon shares rose to a record $701.92, up more than 3 percent, after the announcement. The company’s market capitalization now exceeds $333 billion.

Video producers can choose between having their shows and videos offered to Prime subscribers at no additional charge; then Amazon pays them royalties based on hours viewed (in the U.S., it’s 15 cents per hour).

Creators can also have their video be viewed for free with ads (they collect 55 percent of the ad revenue and Amazon the rest).

Producers can also set up their own subscription channels a la HBO, charging customers a monthly subscription fee (Amazon takes half the revenue).

And those content creators who decide to sell or rent out their videos get half of the proceeds.

Additionally, Amazon will spread $1 million a month among the top 100 titles that are shown at no charge to Prime users. The money is pro-rated based on how many people view the titles.

The service opens the gates to amateur and professional video creators with valid Amazon accounts in Germany, the U.K., the U.S. and Japan.

Greg Ireland, an analyst with research firm IDC, says the service will help diversify Amazon’s video shelf, bringing to it a lot of non-traditional content — in short form, or created for the Web — favored by younger audiences raised on a YouTube diet.

The service is also a boon for content creators, because they have more control of their distribution and monetization strategies. “It may not have the audience size today that YouTube has, but it certainly gives more flexibility to content partners,” Ireland said.

The initiative could help more providers become economically sustainable, he added.

(Source: TCA)