Apparently Youtube has announced it will renew around 40% of the original content channels it funded last year (paying channels up to $5 million). As reported by AllThingsD, the channels not receiving new funding won’t be kicked off Youtube – and why would they with infinite space, and the deal requiring them to pay back the investment via advertising revenue if it hasn’t already been recouped?

What sparked my interest was the comparison to traditional TV only picking up the hits at the end of a season, and the fact that the first two comments on the article both said the experiment was a ‘failure’ in traditional TV terms and because 60% won’t be continued.

I’d completely disagree, and it’s symptomatic of the ease with which we default to existing yardsticks.

The long tail strikes again:

Presumably Google has already made back the initial investment on the 40% for renewal, or is close.

For the remaining 60%, Google will make back it’s investment eventually – those channels will remain contributing in perpetuity until they break even.

And the creators that aren’t having renewed deals do have an incentive to keep going – the investment and news will have certainly allowed them to raise their profiles and traffic beyond what they previously had. It certainly should have done with millions of dollars being handed out. Once their investment is re-payed they get the benefits of their increased traffic and funding to go forwards with.

I’m not a Google fan boy by any stretch of the imagination, but having followed the online video industry closely for many years, things have changed with the lowering costs of bandwith and storage, and that means better opportunities for all involved to operate with a lower risk. The cost of a prime time TV network show would be far more than a Youtube channel, and if it failed, there’s no coming back – compared to any of the ‘failed’ channels which could still break out with their next video or series.