YouTube may be the king of online video, but if Arik Czerniak has his way, the king won't stay on the throne for long.
Czerniak is the CEO and co-founder of Metacafe, one of the web's leading independent video-sharing sites. The company is launching a new service Monday called Producer Rewards which will offer cash payouts to video creators who upload the most interesting and entertaining clips.
By offering incentives to users who upload premium content, Czerniak hopes to be able to deliver a richer experience to the casual viewer, thus giving Metacafe the edge that it needs to maintain in order to compete with YouTube, MySpace Video and the other big names in user-generated video content distribution.
Metacafe utilizes 100,000 volunteer reviewers who sort through the flood of video submissions, promoting the best videos and rejecting the clips that they find unappealing or boring.
"People who watch video on the web are hungry for good content, and they are ready to consume a lot of it," says Czerniak. "You could put your video on YouTube and get a lot of views, but you have to actively market yourself in order to be heard over all the noise. Or, you could post it to Metacafe where we have developed a process that lets the best videos get played immediately so they can start earning you real money."
Metacafe users can submit videos to the Producer Rewards program if they meet the legal standards required for licensing: The clip must be suitable for all ages and the producer must own all of the content -- lip sync videos are out, and any people featured in the video must sign a consent form. Once the video is accepted by the reviewers, it's put on the site where it can be viewed by all Metacafe users -- and where it can start earning cash for the creator.
The Producer Rewards videos on Metacafe are served along with short post-roll or pre-roll advertisements which provide the revenue the company shares with the producer.
After a video reaches 20,000 views on Metacafe, the video creator starts receiving payments of $5 per 1,000 views. Czerniak estimates that more than 30 percent of the videos on his site have surpassed the magic number of 20,000 views.
Metacafe, which has recently relocated from Tel Aviv, Israel, to Palo Alto, California, claims that user feedback from a beta test during the month of October has been positive. One participant earned $23,000 after his video was viewed 4.5 million times.
While YouTube has yet to institute a model for paying users who submit the most entertaining videos, other video-sharing sites have recently begun compensating their most creative uploaders. Video startup Revver serves short, static advertisements at the end of user videos. If a viewer clicks on the ad, Revver splits the ad revenue with the video creator, paying out 50 percent of the profits. Low-brow humor video site Break.com pays its submitters $1,000 if their original video is popular enough to get promoted to the site's front door. Video producers whose submissions to the Yahoo Current Network get picked for the site's front door or its companion cable television network can earn a one-time reward of up to $600.
Metacafe licenses the videos in the Producer Rewards program from the creators under a nonexclusive agreement, so users are able to share the videos and re-post them elsewhere. Producers also earn revenue from their videos if they are shared on other sites using Metacafe's embedded video player.
"Metacafe's model is a powerful way of persuading users to publish on one site rather than the other," says Joe Laszlo, a senior analyst at JupiterResearch. "Since there are so many producers of video content right now, competition is bound to heat up."
"YouTube will continue to attract the most submissions as long as it has size on its side," Laszlo continues. "YouTube can say, 'Publish here, we have the biggest audience.' Smaller sites will have to move towards this payment model in order to counter against that size advantage YouTube has."
Roughly 1 million users visit Metacafe per day, and the site's users watch about 15 million videos every day, a fraction of YouTube's estimated 100 million daily video views.
Czerniak claims that YouTube's size works against content creators by making it difficult to get noticed.
"Saying YouTube is a good distribution model is like saying Blogger is a good distribution model," says Czerniak. "YouTube is a really great product, but there are tons of videos with zero views on the site. Many of the clips that are actually good or interesting get lost under this mess."
