On February 14 2005, YouTube’s co-founders, Chad Hurley, Steve Chen and Javed Karim registered the site’s domain name and set out to “create a place where anyone with a video camera and an Internet connection could share a story with the world”, according to the company’s recent blog entry.
The first YouTube video was entitled ‘Me at the zoo’ and shows co-founder Karim at San Diego Zoo. It was uploaded on April 23 2005 and is still on the site.
The site officially launched in November 2005, after six months of public beta testing and by July 2006 the company announced that more than 65,000 new videos were being uploaded every day – with 100 million video views per day.
YouTube did not begin as the market leader in the video space and faced competition from the likes of Vimeo and Viddler. However, it soon overtook its rivals because of how easy users found its uploading and embedding tools.
In October 2009, the site celebrated serving over one billion views per day on the third anniversary of it being acquired by Google for $1.65 billion (£883m).
Hurley, who remains YouTube’s chief executive, wrote on the video-sharing site’s blog on that day: “Three years ago… we’d just made headlines by joining with Google in our shared goal of organising the world’s information (in our case video) and making it easily and quickly accessible to anyone, anywhere.
“Today, I’m proud to say that we have been serving well over a billion views a day on YouTube. This is great moment in our short history and we owe it all to you.”
He went onto to detail how aspects of the site have had to move with the times: “As bandwidth has increased, so has our video quality. As we’ve started to see demand for longer, full-length content, we’ve brought more shows and movies to the site. There are now more ways than ever to make and consume content, and more of you are looking to turn your hobby into a real business.”
Indeed the services the site now offers have transformed radically from its early days – when it was typified by user generated videos showing dogs on skateboards – which become viral web sensations overnight.
YouTube is in the process of trying to reposition itself as a platform which shows professional content, as well as its bread and butter user generated content. Having signed content deals with the likes of Channel 4 and Five, as well agreements to livestream sports tournaments, like the Indian Premier League cricket matches, it is well on its way to becoming one of the world’s largest digital aggregators of content – both amateur and professional.
Ian Maude, Enders Analysis’s head of Internet said: “Since its early days back in 2005, the YouTube consumer experience has changed from all recognition. Users would never have thought of watching a TV show via the service and now they can access all of Channel 4’s content from the last 30 days.
“It is becoming a content platform in its own right. It used to be just a free for all that the great-unwashed could use to post pretty much anything – copyrighted or not. But Google has done a great deal to solve those teething rights issues, while pursuing formal content agreements with the major broadcasters and rights holders.”
However, the site still famously has yet to turn a profit and deliver any major returns to Google. And despite the fact that at the end of 2009, YouTube had more than tripled the amount of views it was able to monetise, year on year, the high costs of streaming video online en masse is still understood to be a major barrier to reaching profitability.
The increase in the amount of views it is now able to monetise has grown due a rise in the number of content owners, such as ITV, opting to use YouTube’s ‘content ID’ system.
Content ID is YouTube’s copyright fingerprinting system which allows rights holders to block or make money from unauthorised use of their material. It is free of charge and being used by 1,000 content partners globally, including major brands such as Electronic Arts and Sony BMG.
It has played a major role in content holders regaining control of the unauthorised use of their material on the major video site and reducing the amount of legal actions are brought against YouTube for copyright infringements.
Rights holders, once unauthorised use of their material has been located, can then either choose to have it removed from YouTube, or for YouTube to serve an ad around the video and split the money in a revenue sharing deal which Google says favours the content owner.
One third of the content being monetised has come from unlawful user uploads, the content owner has chosen to keep up on the site in exchange for an advert being served. And two thirds of the videos making money are uploaded by the content partner themselves. YouTube is selling the majority of the adverts around the content – unless a special arrangement has been negotiated, as with the Channel 4 deal – where the broadcaster sells the adverts around its own content.