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CNNMoney Scolds Media for Shunning YouTube

Today, CBS spurned YouTube for its online user-generated video content, going with CSTV instead (check it out on MarketingVox). The college sports network will be teaming up with CBS for a March-Madness-themed UGC contest (though I can’t imagine anyone would want to watch the NCAAs when you just know Duke won’t win. So sad. ;) ).

Roger Kay, principal analyst at Endpoint Technologies Associates, says of the CBS/CSTV deal: “It’s about narrowcasting—getting a more finely grained view of your audience and being able to cater to them more specifically is now more attractive.”

Apparently CBS officials don’t read CNNMoney.com. Yesterday’s commentary, entitled “Wake up, media! YouTube is not the enemy!“, counseled big media corporations that they shouldn’t fear YouTube, but embrace it. From the article:

But so far, it appears that shunning YouTube might not really hurt YouTube all that much. In fact, it looks like big media may need YouTube more than the other way around.

According to figures from Internet research firm Hitwise, YouTube’s traffic actually increased 14 percent in the first two weeks after Viacom asked YouTube to pull its videos.

This could be a sign that YouTube, which some have suggested would be in trouble if more media companies followed Viacom’s lead and demanded for videos to be taken down, may actually not be as dependent on mainstream media as previously thought.

“One thing that is quite remarkable is that people tend to be looking for consumer generated content more than actual TV content on YouTube,” said Bill Tancer, general manager of global research for Hitwise.

Paul La Monica, CNNMoney.com editor at large, concedes that big media companies want to get paid for their content. He closes the section with a quotation from Mark Pascarella, CEO of Gotuit Media: “For big media firms, it’s no longer sufficient to just make your content available online. . . . It is less about getting new eyeballs and more about engaging that audience, growing it and making money off it.”

Unfortunately, that’s as helpful as the article gets. YouTube and the Internet information economy have gotten us used to free content. It’ll take time before YouTube, CSTV, CBS and the rest of them figure out the best way to monetize video.