Rahul Pandey

Youtube features - product management

March 01, 2020 | 8 Minute Read

Global video streaming industry is worth $22.6 billion in 2018. With Netflix, Hulu, Amazon Prime Video, Hotstar, Jio TV, MX Player, and Youtube are competing for users’ attention. Everyone, from video streaming companies to mobile apps like Facebook, is competing for on-screen time, on-screen time not only help generate revenue for the company but also eats away revenue from other companies. So here we would try to help Youtube increase the on-screen time and add new revenue flows.

Addressing the bottom of the pyramid

Most major online video streaming players are working on a subscription model where they charge a certain amount in return for video content. They are not directly serving the people at the bottom of the pyramid. People who don’t have a lot of purchasing power but are there in large numbers.

When you think of the bottom of the pyramid (in emerging economies like India), most people for entertainment either have TV or Cinemas - the traditional forms of entertainment. With the rise in cheaper 4G internet, millions of people are now using smartphones. And for these people Android has the largest share. Youtube comes preinstalled with every Android device. Not Netflix, not Amazon Prime Video, not Hotstar, only Youtube. (Which is why these companies have to tie up with OEMs.)

Clearly, Youtube’s market is the same as that of TV and Cinemas, and is growing rapidly. With more online streaming services and traditional TV channels providing online offering, cable TV is left in a bad shape. Cable TV may die. And Youtube has a headstart with numbers - the number of devices with the app installed, and it’s revenue model is same as that of cable TV - ads. So Youtube can come up as a major player in capturing the audiences of cable TV by offering similar and economical offerings.

DTH offerings are anywhere from ₹150 to ₹700+ per month. What Youtube can do is offer cable TV channels on and call it Youtube TV. Now, Youtube TV sounds like an obvious name, doesn’t it? So I did a simple search for “Youtube TV” and saw that Youtube is already offering Cable TV services. This was good news as it validates my hypothesis. (Also, Tata Sky is offering similar services.) Let’s discuss the current offerings provided by Youtube TV:

  1. Charged at $49.99 per month Available only in the US
  2. Streams live TV
  3. You need to record a show if you are going to miss it
  4. Watch it anywhere

Youtube’s trying to copy the cable TV model and add a little extra mobility. You can summarise Youtube TV as cable TV on the move. That isn’t disrupting the industry, that is going from landlines to cordless and not mobile. Even if you assume, the pricing would be adjusted to emerging economies, the bottom of the pyramid might not be addressed and people would already have cable TV.

Let’s discuss how Youtube can address the issue.

What does the Cable TV network run on? Two things: Subscription and Ads. Why do you want a customer to pay you money for watching content and ads? No more subscriptions.

Google is a behemoth in online advertising. It has all the resources to the ads only model. In fact, it already has a lot of advertising data about users, which can be used to run its own ads instead of the publishers (channels). This as the benefit of showing relevant ads to the viewers, increasing the effectiveness to the advertisers. Additionally, it frees the channel owners from going and fetching advertisers. They can focus on producing shows.

For the middle and top of the pyramid, premium features can be added in place of ads. This would push for on-demand TV shows, or allow the publishers to publish multiple episodes at once for binge-watching. Convincing on-demand should be much of a problem as there already are on-demand offerings by DTH providers. No more recording TV. One added benefit would be that shows would no longer need to compete with each other for prime time as every hour would be prime time.

Youtube can share insights about the viewers with the publishers and advertisers to help them create better content and newer shows. This is something that Publishers won’t find on TV. The numbers are produced from thin air as it’s difficult to track such metrics on TV. This would be the real TRP. Additionally, the insights can be used to identify the regions where the shows are popular and that can be used to show translated shows and multi-language subtitles. A show may have a high number of views in Brazil, then that show could be dubbed in Portuguese.

They can build a recommendation engine (to which I will come to later) to suggest similar shows. This is something that tradition DTH can’t do. This would also help publishers and create more content that’s in alignment with the trends.

One thing that I had read some years ago was alternative story lines. With online streaming of TV shows this becomes possible. Not sure how much value this would be but it’s up to the producers.

To summarise:

  1. Don’t charge subscription fees like DTH
  2. Show ads based on the user demographics and interests
  3. One demand TV shows. (No more arguments for the remote)
  4. Share insights with publishers and advertisers.
  5. Local language dubbed shows (this also means global audience)
  6. Recommendation engine to recommend similar shows

Benefits:

  1. Wider market for Youtube. Additionally given the current model of Netflix, and Amazon, it might difficult to enter that market. Easy penetration.
  2. A large population can access TV on to go.
  3. Better analytics and data for producers and advertisers
  4. Channels outside of the regions can be brought under one roof, and would also consolidate channels showing literally the same thing

Challenges:

  1. To get all channels in a region under one roof. They would also be nervous about it as something like this has never been tried before at such scale. But Google already has a precedent set by Apple when it brought the music labels under iTunes.
  2. Will have to check local body laws regarding this. Meaning more lobbying.
  3. Discomfort among the current content creators on Youtube because of increases in competition. But youtube can address content creators by becoming a medium where producers can contact creators. Many creators use Youtube as a platform to show their creativity to get contracts from Netflix, Amazon, etc. Additionally, there already is competition from other creators so this should not be that bad.

A better video feed

When I look at my current video feed it is terrible. Only Quora’s feed is worse that it. One reason that the trending section is useless could be that they are generalising way too much. They need to cater to an individual user.

This can be achieved in two ways:

  1. Working on the recommendation
  2. Showing content according to the mood of the person

Recommendation

Youtube can ask the user to tell it the topics that they are interested in. Twitter and Quora have done this for new sign-ups. And for Twitter the experience is enriching. Basically, we take something that works for someone and craft it to suit our needs. Why reinvent the wheel?

  1. Ask people what kind of videos they are interested in - active

When it observes that a user is watching a certain type of video, then it can show a pop-up saying, “Do you want to see more of such videos?”

  1. People may not share some of the genres for reasons, it can figure out the topics and show that as well - passive
  2. Provide an option to reset recommendations or remove certain topics

A user could be viewing a lot of political content but when the elections are over, they don’t want to watch any more of political content.

Mood

Unlike Gaana or Spotify where only one sense - hearing - is used, for YouTube visual - sight - is also used. More focus is needed to watch a video than a song so gaining attention is more important. One can zone off while listening to a song but when watching a video most people make a conscious decision to watch a video. Additionally, Instagram and Snapchat also use these senses but the attention time needed is drastically restricted.

So if to address this we can ask the user what mood they are in and show videos accordingly. If the user is energetic, then maybe they can watch a video on quantum physics and if they are tired, then maybe a comedy. If they are in the mood to listen to a particular genre of music, so be it. (Oh!, yes. Spotify is on a sharing spree with this mood playlist thing on twitter and ad campaigns.)

Challenges:

  1. Nothing much. This solution is fairly easy to work out given the engineering force Google has

Which one works the best?

The former one is a strategic solution that opens a new revenue source while the latter one is a tactical one that helps Youtube engage users and preventing them from going to Instagram, Snapchat.