Only a moron would buy YouTube?

Discussion in 'Wall St. News' started by a529612, Sep 28, 2006.

  1. REUTERS Mark Cuban: Only a "moron" would buy YouTube [GKQVCTT]

    By Paul Thomasch

    NEW YORK, Sept 28 (Reuters) - Billionaire investor and
    dot-com veteran Mark Cuban had harsh words on Thursday for
    YouTube, the online site that lets people share video clips,
    saying only a "moron" would purchase the wildly popular

    Cuban, co-founder of HDNet and owner of the NBA's Dallas
    Mavericks, also said YouTube would eventually be "sued into
    oblivion" because of copyright violations.

    "They are just breaking the law," Cuban told a group of
    advertisers in New York. "The only reason it hasn't been sued
    yet is because there is nobody with big money to sue."

    YouTube, based in San Mateo, California, specializes in
    serving up short videos created by everyday people. Its
    popularity, with more than 100 million video showings daily,
    has spurred speculation the firm will be sold or taken public.

    But YouTube has also come under scrutiny because users
    often post copyrighted material, including music videos
    produced by well-established artists.

    YouTube company representatives were not immediately
    available to respond to Cuban's comments.

    Cuban said "anyone who buys that (YouTube) is a moron"
    because of potential lawsuits from copyright violations.


    "There is a reason they haven't yet gone public, they
    haven't sold. It's because they are going to be toasted," said
    Cuban, who has sold start-ups to Yahoo Inc. <YHOO.O> and

    YouTube, which has nearly one-third of the U.S. Web video
    audience, three times that of Google Inc. <GOOG.O>, or twice
    that of News Corp's <NWSa.N> MySpace, has been working on
    signing licensing deals with music companies and TV networks to
    ensure they are paid when users view their content.

    This month YouTube unveiled its first deal to distribute
    music videos legally from a major music company by agreeing a
    deal with Warner Music Group <WMG.N>, home to pop stars James
    Blunt and Madonna.

    In other remarks, meanwhile, the often-controversial Cuban
    also told advertisers that the reach of YouTube is limited,
    particularly when it comes to user-generated videos.

    "User-generated content is not going away," he said. "But
    do you want your advertising dollars spent on a video of Aunt
    Jenny watching her niece tap dance?"

    "Somebody puts up something really good and you get, what,
    60,000 viewers?" Cuban added during the event at Advertising
    Week in New York.

    YouTube now offers advertising through banner ads,
    promotions and sponsorships. It has said it plans to roll out a
    range of different advertising options over the coming year.

    Cuban cautioned advertisers against investing heavily in
    so-called viral campaigns that are spread by users beyond their
    initial point of distribution on YouTube or other video sharing
    sites. But he touted opportunities to run commercials on
    high-definition television such as his HDNet network.

    "What makes viral so special is it's so hard to do. It's so
    hard to plan. It's hard to stand out," he said, describing 99
    percent of money advertisers spend on viral campaigns as

    "You guys love to be the trailing edge," he said.
  2. Pabst


    LOL. The guy who made hundreds of millions by selling the worthless to Yahoo is now the arbiter of internet media valuations.

    Where's Taleb when you need him?
  3. Actually became worthless under yahoo. It certainly had some promising technology at the time but yahoo simply didn't know how to develop it. I wouldn't be surprised if Cuban actually shaves off millions off the valuation of youtube. A crapload of people actually pay attention to him.
  4. cuban's pic should be on the cover of FBR. that said.. there will be some interesting fall out concerning shared videos.
  5. Cuban either does not understand YouTube...
    Or he is LYING in order to promote a competitive site like his own.

    All his arguements are like 6 months old and no longer apply...

    And Cuban will not reverse it by LYING to people.

    Roughly 90% of the copyright owners whose videos are put up on YouTube...
    Have realized that the free advertising FAR outweighs anything lost...
    And only a tiny minority is so out of touch that they have their stuff taken down.

    He keeps on lying...

    Nobody goes to YouTube for the amateur stuff...
    But for the ** archival stuff ** from the last 40 years...
    That you have not seen since 1975 or whatever.

    It's big nostagia site.

    And qualilty no longer matters... too bad for Mr. HD Cuban...
    Because after watching a few 1000 clips on YouTube...
    One is desensitized and accepts Flash level quality...
    Because that clip you haven't seen since you were 16...
    Was filmed in like Super 8 or whatever.

    In the LAST MONTH YouTube has gone from #18 to #10 and rising...
    It has the "critical mass" to be impervious to competitors like Cuban.
  6. youtube allows you to see exactly what you want to see. there is no mainstream media to filter out content, i am sure that upsets cuban. he gets his panties all bunched up over this yet he sees nothing wrong with illegal naked shorting.
  7. Pekelo


    Well, it takes a thief to catch a thief. I think Cuban is right. As long as the website is small/not much used it can avoid a lawsuit but when there is money to be made and lost, lawsuits gonna come.

    Why would you buy let's say your fav sitcom on DVDs, when you can see it on Youtube?
  8. Youtube has a 10 minute limit...
    And it is not about watching Premium Content.

    Demand for luxury goods like very current DVDs is relatively inelastic...
    Well off people will buy them for the quality...
    Like I dont think twice about $20 for a DVD...
    While people licking the sidewalk will not buy them EVER.

    To understand YouTube... it helps to give an example.

    Shakira has 5,892 clips on YouTube.
    She has probably made 20 videos or so... of which maybe 5 have any current value...
    And the current ones are low Flash quality... but OK to watch.

    You wanna watch Shakira park her car? Probably a clip on YouTube.
    Wanna see 100 crazy mashups made by Japanese fans... its there.

    The whole thing is a BIG PLUS for Shakira,s career.

    But thats not who really benefits...
    Its the Tier Two and Tier Three artists that are having careers revived/charged.
    People you never heard of have 100 clips on YouTube.

    Another example from Wired:

    Establised star like Beck...
    Is releasing a mashable video for each song on his album on YouTube...
    Also many different mixes...
    Says to fans... mashup my new album any way you want...
    Be part of the artistic experience.

    All the smart guys in Hollywood figured this out about 3 months ago...
    That YouTube must be embraced and supported.

    The battle is over...
    The guys like Cuban that want to sell you expensive, proprietary HD stuff are toast.
  9. The article you posted is full of shit!

    MySpace blows them all away.


    If Cuban was truly smart, he would be loading up on NWS at this very moment....has been basing for many months and is about to blast off higher and blow right past its 52 week high!
  10. Pekelo


    The average sitcom is only 23 mins long. But you had a good point. Google's video quality is much better than Youtube's and they guard copyrighted material better than Youtube.

    Bottomline is, I wouldn't buy Youtube at this point...
    #10     Sep 28, 2006