YouTube, Google, and the Rise of Internet Video
Case Study 2
Cassie Brown, Meshelle Dyer, Laura Tracey, and Brittney Vogel
AMBA 670, Section 9244
May 1, 2012
Team Illuminist: Case Study 2
The recent trends in Internet video have provided opportunities in the market. Although many companies attempted to capitalize on this market opening, many firms were not successful. Google was unable to get a strong presence in the market with their Google Video service until it purchased YouTube in 2006. Combined the companies now accounted for four times as many users as their closest competitor in the Internet video market (Cool, Seitz & Mestrits, 2010). Analyzing Google and YouTube will provide insight into the reasons some companies were more successful than others. This paper will explore why Google missed the Internet video opportunity, the evolution of the video supply chain, and the future outlook for video based on competitor strategies. Additionally, it will outline possible revenue models for YouTube and recommend a business strategy.
Google chose to enter the Internet video market using its competitive advantage in searching. The company developed an infrastructure of servers, storage systems, bandwidth, and hardware that supports the fastest and efficient searches on the web (Smart Advantage, 2012). Google Video was designed for a competitive edge in providing a service where users would be able to search for any type of video. According to Google’s co-founder Larry Page, Google video aimed to do for television what Google did for the web (Cool et al, 2010). Unfortunately, Google competitive advantage failed to overtake rivals due to poor initial design, lack of openness, unsatisfactory service, and copyright issues. Google Video was designed to allow users to find videos in the search history and bookmark them, but it cumbersome for users to operate. Compared to YouTube, YouTube had a more of a basic and...