San Francisco — Internet’s most popular video-sharing site YouTube on Tuesday added links to its stores of a home shopping network in its latest effort to squeeze more revenue from its massive audience and justify the $1.76 billion that Google Inc. paid for the site two years ago.
The Google-owned service, unveiled Tuesday in the United States, is taking the first steps toward building an e-commerce service, there will be buttons under YouTube videos to offer viewers a chance to buy music, movies, TV shows, concert tickets and other media-related products featured on the millions of videos on YouTube.
Visitors to YouTube.com can now buy songs from music videos they watch on the site by clicking on buttons that take them either to Amazon.com Inc.’s MP3 store or Apple Inc.’s iTunes store.
YouTube users will also be able to buy video games, such as Electronic Arts Inc.’s sci-fi game “Spore” through the Amazon link.
Amazon and iTunes will share revenue with YouTube when users buy content through the partnership.
“They spent a ton of money on this thing and it is natural they want to make a return,” analyst Rob Enderle of Enderle Group in Silicon Valley said in a statement.
“The trick is how to do it without scaring users to another property. It is going to be a delicate dance.”
“Ultimately advertising is most effective when it makes the most sense for what a user is doing at that moment,” says YouTube spokesperson Aaron Zamost. “The ultimate goal for YouTube advertising is to create the right ad for the right content.”
Until now, YouTube has mainly pointed to advertising sales as its main source of income. It is still experimenting with a range of formats to take full advantage of the massive popularity of the site, which has nearly 13 hours of video uploaded every minute.
YouTube had 330 million visitors in August 2008, according to comScore, which measures Internet audiences.
“There will be lots of different solutions for lots of different problems,” Shishir Mehrotra, YouTube director of product management, said in an interview. “We have tested a lot of things already, and we are going to be testing more in the future. Some will work, some would not.
For starters, YouTube is selling songs only from two major labels, EMI Music and Universal Music Group, and video games made by Electronic Arts Inc. But it hopes to persuade studios to peddle movies and TV shows alongside video clips.
The “Click-to-Buy” links are part of YouTube’s intensifying focus on figuring out how to profit from its popularity without alienating an audience accustomed to watching clips without the commercial interruptions that fill television airwaves. YouTube also has had to navigate thorny copyright issues that have restricted its ability to show ads.
“This is just the beginning of building a broad, viable e-commerce platform for users and partners on YouTube,” said a message on the website.
“Our vision is to help partners across all industries offer useful and relevant products to a large, yet targeted audience, and generate additional revenue from their content on YouTube beyond the advertising we serve against their videos.”
The feature most enticing for brands should be click-to-buys integration with YouTube’s Content ID program, which enables content partners at YouTube to identify portions of their content in user uploaded video content.
And, for those not fascinated in buying, the links will at least allow people to find out the name of an artist and title of a song playing as the soundtrack of a video they are watching.
“Our goal is to slowly but surely expand the program to add additional content and product partners, as well as our international users,” YouTube said. “We are just getting started, so stay tuned.”