The World Revolves Around YouTube

Home theater screens are widening. Cable properties are growing exponentially. Why is everyone running over to the small screen, instead?

Google 's (Nasdaq: GOOG) YouTube continues to champion the booming Web video market, feeding appetites for short-attention-span entertainment. It is apparently hungry for more. YouTube has been quietly rolling out new features in recent weeks, lifting pages out of the playbooks of dot-com vets like Netflix (Nasdaq: NFLX), MySpace, and even Google's own AdSense.

It's easy to see why the site is moving so quickly. Stateside consumers watched nearly 11.5 billion video clips online in March, according to comScore's Video Metrix. That is a whopping 64% larger than a year earlier.

Google accounted for a thick 38% slice of the traffic, mostly through YouTube of course. No one is even close. The distant silver medalist is MySpace and FOX parent News Corp. (NYSE: NWS) with a mere 4.2% sliver of the clip culture market.

Companies in YouTube's position wouldn't be prone to taking chances. There is no one in the rearview mirror, so why tweak the formula? Well, YouTube has been rolling out several new features lately.

For those who aren't addicted to YouTube, recent innovations include:

Amazon.com (Nasdaq: AMZN).Friend Activity: a module with feeds on what confirmed friends are doing, similar to social networking sites like MySpace and Facebook.An option to show only YouTube's revenue-sharing partners in search results. Those videos are now tagged with red triangles to stand out.

Monetizing YouTube's heavy traffic hasn't been easy. The person in charge of that monumental task left the company earlier this month. In a lesson learned cruelly by dot-com bubble victims, page views don't automatically translate into dollar signs.

The real money in this space has been made by webcam makers like Logitech (Nasdaq: LOGI) and content delivery networks like Akamai (Nasdaq: AKAM). I still like Google's chances.

If anyone can make this work, it's Google. The company is the leader in online advertising. However, the new modules-based customization and friend feeds find Google working on a stickier site than just a video-sharing website for the clip culture junkies.

I guess that's why the You comes before the Tube.

Copyright © 2008 Universal Press Syndicate.