As the undisputed champion of a now well established, maturing market, YouTube has short form video well and truly under lock. Since its purchase by Google in 2006, and arguably even before that, the platform has been ubiquitous with online video. Enter Vessel, fronted by former Hulu CEO Jason Kilar and CTO Richard Tom, a platform looking to be a serious alternative. Offering an increase in the revenue video creators take from their content, Vessel aims to unsettle the monopoly Google has to this point held over the framework behind monetization of user created video content.
Since Kilar’s breakaway from successful US streaming platform Hulu, he has been trickling out information about his new project, initially codenamed Project Fremont. Attracting talent from Hulu as well as a wide range of investor intention, totalling $75m in funding, Kilar’s project has steadily grown its presence and platform through to public beta launch last month.
For a minimal subscription fee ($3 a month), Vessel grants members early access to content that will be also be on YouTube. Interestingly, the service will also be ad-supported, delivering what Vessel call bringing “the same type of windowing and dual revenue streams to online video that have existed for traditional media for decades.”
Vessel claims YouTube creators make about $2.20 per thousand views but could make as much as $50 on its own service in return for 72 hour exclusivity. Vessel, at least initially, will be gifting 60% of subscription revenue and 70% of ad take to those who make content for them. The thinking is that with greater agency over their business and more to show for it financially, creators will be able and inclined to make better content for audiences.
Content creators will no doubt have no issues with the proposition of greater revenue for their work, but will viewers be prepared to pay for content YouTube has been offering freely? Vessel claim the costs are so minimal as to be a non-issue, but with small charges come small margins, and it remains to be seen how successful their model will prove.
For internet businesses, things move fast – meaning supremacy can easily give way to redundancy. Some believe YouTube could go the way of Yahoo and other market leaders before it, shifting from leader to struggling, antiquated and increasingly irrelevant new/old media hangover. With no clear competition, YouTube hasn’t evolved all that much since establishment, at least in terms of its platform and design. Notably, Yahoo reportedly had the opportunity to buy Google in 2002, so should Google be looking to snap up Vessel? Quietly confident, Kilar proclaims that “the market is on the cusp of some very big seismic changes.”
Acquisition is not exactly what he has in mind.