YouTube's Identity Crisis

Three years later, Google is still trying to spin YouTube’s straw into gold.

The newest idea: YouTube, until now a free-for-all site, wants to rent you movies. It’s in talks with Sony, MGM, Lionsgate and Warner Bros. to offer new releases online as early as the same day the DVD is available, The Wall Street Journal reports. Bloomberg and NY Times ran similar stories.

It’s evidence of YouTube’s ongoing frustration in trying to convert billions of video views into revenue. Google assumed the huge horde of video viewers was worth something (i.e. $1.65 billion), but it hasn’t figured out how to “monetize” them effectively (see YouTube Looks to Monetize One-Hit Wonders, YouTube May Lose $470 Million In 2009: Analysts and YouTube: Still a $0 Billion Business).

So what’s YouTube trying to be?

A place to find free videos, like “The Evolution of Dance,” which has been viewed more than 125 million times? A way to share home movies? A site that aggregates promotional episodes or short clips from cable and broadcast networks (e.g., Discovery, CBS, Disney/ESPN)? Or a venue for watching pay-per-view movies on your PC?

It’s trying to be all of those things. But to me, YouTube’s mix of programmed, premium content — and now, potentially movie rentals — with a potpourri of a gazillion alternately odd, clever, or boring video clips gives the brand a decidedly split personality.