The “Inside the Tornado” Analysis of Web2.0 Online Video Industry, Core Case: YouTube

• Main Authors: Li,Ting- Fang, 李廷芳
• Other Authors: Lee,Jeff
• Format: Others
• Language: zh-TW
• Published: 2008
• Online Access: http://ndltd.ncl.edu.tw/handle/98320421985862511653

碩士 === 國立政治大學 === 科技管理研究所 === 96 === “Web2.0” creates lots of entrepreneur legends and becomes a new trend. But only few of the Web 2.0 websites can grow and become very popular. Therefore, this study picks “YouTube”, the fastest growing website in the Internet history as its core case, and it includes 12 study subjects in total. The two research questions are listed below. 1. Why did YouTube grow so fast? 2. The concept of video sharing which YouTube provided appeared frequently. Some of the websites started their service first; some of them did similar things at the same time. Why not the other competitors who had first mover advantage could win, but YouTube won? One of the characteristics of Internet Industry is “easy to copy”. When facing the competition of big companies which duplicate their idea and attacked with abundant resources, why did YouTube still survive? Ifilm (1997) started its online video sharing business when the cost of bandwidth was still very high. And it served online videos for free afterwards. Break (1998) featured male’s humor, attracted a large number of videos. However, the related environment was not ready. Blog and online photo sharing were not popular at that time. In 2003 to 2005, lots of similar competitors such as Metacafe (2003), Grouper(2004), Sharkle(2004), Vimeo (2004), Veoh (2005), and Revver (2005) established. Some of them used P2P technology; some of them had great editor reviews, and the others provided revenue sharing model. On the other hand, YouTube’s growth came from continuous try-and-error. It failed to be a hotties video sharing website in the begining, and then tried to be “Your Digital Repository”, “Upload, Tag and Share Your Video Worldwide”, and now positions itself as a website for “broadcast yourself” which represents the spirit of Web 2.0. The slogan of YouTube has changed for four times, and the user interface has also changed dramatically. When facing increasing users and videos, YouTube tuned their program very often as well. Yahoo! lost the timing of catching up. Because it stayed in its core capability- search. Although Google video got online a little bit earlier than YouTube, it still started from video search. Moreover, the upload policy is too strict. Google ended up with acquiring YouTube for 1.65 billion dollars after the failure of operating an online video store (2006.11). YouTube developed “Embed” feature and caused a viral spread. MySpace became its main upstream (over 20%). That made myspace build its own “MySpace video” service and vowed to duplicate a similar service as YouTube. Neverthless, YouTube was not stopped by MySpace’s reaction. As creative videos became more and more, YouTube continued developing new features to fit users’ needs. It rapidly went through the cycle of “build-design-test”. Because YouTube grew with its users, co-development with the users became its charisma. The findings are as following. (1) In a developing industry or a new field, the gurus are not experts or authorities, but are the market audience. The insistency of vision and the will to change with the market are the reasons why YouTube continues to grow. (2) Both network effect and indirect network effect should start and be used simultaneous. Linkage is more important than productivity. Take advantage of external resourses efficiently; especially take advantages of those giants in the other industry. Concentrate on company’s own core capability. (3) Because duplication happens often in the Internet industry, the first mover advantage seldom exits. The real advantage is from the ability of quick reaction and deep consumer observation. (4) Grass strategy: using a large scale testing to hear the voices of consumers. The changing speed is more important then accuracy. Pursue “good enough” solution, not “the best” one. The formation of enterprise strategy is like growing grass. The point is keeping the soil fertile and keeping it free to grow. (5) Core capability will be core rigidity if one company can not input knowledge into its organization.