- The Washington Times - Wednesday, August 16, 2006

NEW YORK

It takes only a few minutes to see why YouTube.com has rocketed to the top of the Internet — hilarious amateur dance routines, a hypnotic juggler, a Hong Kong bus fight and the most incredible caterpillar you’ve ever seen crawling across a floor.

Barely 1 years after it was started to host short videos posted by the public, YouTube is streaming more than 100 million clips every day, putting it at the center of online culture.

It’s already popular enough to be embraced by “old world” media, with a new tie-in with NBC television after its replays of clips from the network’s “Saturday Night Live” comedy show drew more viewers to the show itself.

“It’s the Web site which is becoming the most successful. YouTube is in similar position to Myspace” as the dominant player in its area, says industry watcher Phil Leigh of Inside Digital Media.

It also has become the leader of online video Web sites, with 60 percent of the market, surpassing Yahoo, MSN, Google and AOL, according to Hitwise, which measures Internet audiences.

Started in February 2005 by some Silicon Valley veterans, YouTube saw its visitor numbers quadruple from January to June, according to Nielsen/Netratings.

By mid-July, they hit the 100 million mark for videos viewed each day, on the back of submissions such as the surreptitiously filmed, tense Cantonese-language argument known as “Hong Kong Bus Uncle” and the hectic six-minute dance medley “Evolution of Dance” by Jud Laipply.

A small-time motivational entertainer, Mr. Laipply hit the big time on YouTube, topping its catalog of tens of thousands of videos with more than 31 million user views.

That’s twice the number of views for the second-ranking video, two teenagers who made their own bedroom rock video to the Pokemon theme music.

Scores of videos have gotten millions of views, and the site gets a boost from replaying viewer-submitted clips from TV shows and such incidents as soccer star Zinedine Zidane’s infamous World Cup head butt, which was turned into dozens of witty takeoffs on YouTube.

Open to anyone to submit his or her work, YouTube has a simple recipe, Mr. Leigh says: “Success because of the humor and the creativity of all the people which participate.”

Once someone creates a free account, he or she can easily put a personal video on the site — as long as it is less than 10 minutes. Viewers can categorize it in specific groups by topic or style, and viewer ratings can send the maker to quick online stardom.

“Essentially, when you have a lot of content that attracts a lot of viewers [that attracts] a lot of content. It’s kind of a virtual cycle,” says Scott Kessler of Standard and Poor’s.

The power was demonstrated by the NBC deal: The network first insisted that YouTube remove the “Saturday Night Live” clips from its Web site, as it had no rights to show them. Then NBC learned that YouTube had helped increase the program’s popularity.

“There were more viewings on YouTube than during the broadcast,” Mr. Kessler says.

So in June, NBC moved to put more of its clips and publicity on YouTube and in exchange linked to YouTube on its own Web site.

The site doesn’t just draw funny items. Artists post their creations, hopeful journalists their clips and politicians their self-promotions.

House Minority Leader Nancy Pelosi of California, for example, has posted 116 videos on YouTube of her own speeches as well those of her fellow Democrats.

“We see ourselves building the next-generation platform to serve media worldwide,” says Chad Hurley, a YouTube co-founder, on a video shown on the YouTube site.

Wall Street isn’t far behind from that view, looking at YouTube as it saw Myspace, the ever-evolving personal Web page host that News Corp. bought last year for $580 million, or the online telephone service Skype, which EBay bought for $2.6 billion.

“In some ways, YouTube reminds me of Skype,” Mr. Kessler says. “Both are leaders in their segments, are very well-known brand names. Both benefit from the network effect, are well-known for their technology and the simplicity of usage that they provide and are well-known for having a lot of very active and passionate users — but not necessarily having a business model that generates substantial profit.”

“And look how much money Skype got. And I don’t think Skype was as sexy as YouTube,” Mr. Kessler says.

Although there have not been any public offers for privately owned YouTube, the New York Post estimated late last month that the company, based in San Mateo, Calif., could be valued from $600 million to $ 1 billion.

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