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How is Google Video doing

YcuTube is getting

March 2006

Vlsltors

Page VJews

Quration

Upoads

more traffic and engagement than Google Video todayj In

Qualitative research in countries reveals the reasons behind this

YouTube is designed around the viral video experience It is clear what the site

promotes uploading and Ii makes it easy to browse video categories

VouTube promotes its viral and community features above all else

is about it

VouTubes content all free and much of highly sought after pirated cUps

utO NISratngs i52OO VouTubsE4 dyMtN9 Mtfl449l 71 SH

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How has International usage differed What are the learnings

hiternationat We have to avoid being UScentric since more usage comes

from outside the US where there are big differences in taste and

consumption across different countries

63% of our playbacks and 40% of our uploads come frvm

outside the US

Large fraction of videos have arge majority of playbacks from

single country Potential takeaway different videos resonate in

different countiles

Playback and support for premium vs usefrgenerated content

varies gnificanfly across different countries Germany vs

Spain

Most of the nonUS top videos have tifles/descriptions not

legible in Engflsh

Top videos in nonUS countries typically dont get big US

viewership

.- -- --

-- -- -- --

-- --- --
Googe Video internationafly

Europe ags the US in internet video

usage but quicky catching up No site

has yet built panEuropean presence

Google Video receives 30% of playbacks from top

EU countries

Qualitative research reveals interest in premium

content varies by county People in countries with

lower Internet video usage Germany France tend

to seek premium over user-generated content

Googe Video became an International GVDbycountry

product even before ocdzed versions

were launched

63% of playbacks and 40% of uploads come from

qysIde the US today

GVs top 10 countries are all western countries

This could be because our up/ca oranci ibdŁxirtz

_________________________ does not fully support GJK characters vet

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Google Video internationaUy contda

Videos the index are still Engllsh

centric despite the fact that 50% of

playbacks come from non-EngHsh

speakng countries

However analysis shows that the most popular

videos requested from non-English speaking

countries still get enough playbacks to rise to

global popularity status

This shows strong demand exists for local

content that we need to encourage

6.9

It GV Language Distribution EIQUSh

NuIU

211 El SpaSh

French

thinese

rtuguese

Gerrmn

Italian

Japanese

oThrfrh

Hebrew

Our top videos drive disproportionate

amount of traffic from outside the US

30% of the top 200 videos in the GV index

receive at least 70% of playbacks from just

single count

56% of the top 200 videos receive the roost

playbacks from p421-US country

tRank Title usa

Loose chance 2nd ed extra footage Hfln Lady punch 72%j

Loose chan 2nd edition 70% th

lNEPALflDA sr 54/al
mportant points to make somewhere the deck

YouTubes business model is competey sustained by pftated content They are at the

mercy of companies not responding with DMCA requests When they do fike CSPAN

did with Colbert they suffer

The DMCA aw coud be overturned if the media industry engages in sustained lobbying

efforts ft was written before the vftal video craze took off and it is risky to build an

entire business model on this law it is also not scalable to expand internationally since

DMA is US law

The VouTube business model is also not monetizabte They are an AdSense

publisher so we have good sense of theft rate of rnonetizatlonPV

YouTube is going after one slice of the internet video market funny usermade

videos There are many more slices in the pie and GV should try to be the broadest

possibe index

We need to continUe CBG support for video internationally b/c we don5t have good ad

monetization solutions yet and some content producers will only distribute their content

if they can sefl it

There is big market for high quality premium content but It is largely going to be

shorter form as opposed to hour movies Perhaps this means we should be working

with media companies to get 2-4 minute funny dips from their shows This will drive

traffic raise awareness of tbQir TV shows Lazy Sndy boost NLs rapg

and be very
nfl Content Acqthsition Priorities

Maintain relationships wI premium content owners and

reset expectations

Continue to push for DTO deals with current features knowing that

uptake wifi be limited

For partners resisting DTO in current form

Seek more free promotional content

Set up advertising and other monetization trials

Reset expectations regarding DRM improvements this year

Focus on one box integration improved browseisearchIpromotion

capabilities to come and RSS to come

Drive traffic through event programming

Set up advertising and monetization trials for current OTO partners

Differentiate based on our respect for copyright

wc1
if

ID

La

ID

ft

Content Acquisition Priorities Contd atanLa

Accelerate growth of torso content

Health/Fitness ag CareTALK

Educational e.g UCTV Regents of UnIversity of California

Faith and Spiritualfty ag Life Balance Media LIME

Lilestyle/Arts e.g BlueHighwaysTV

Travel e.g Wilderness Films International

ChUdren and Famy C.9 Sesame Street

Sports e.g Collegiate Images

Special interest e.g WheesTV

Other Niche Content ag Bollywood films

Additional

Secure mare non-US and non-English language content deals with

new partners

Continue digitization efforts

Consider university lectures pilot

.------v
What Features/Infrastructure Are Needed to Support Content Types

Must4lave Product Features

Home page promotion branded pages

Browse by provider name

Ranking by video quality/premium partnership

Better search functionality

PREMIUM Fasi upload with high service model

Tocis for managing large amounts of content

Payment mechanism for OTO

Disconnected DAM and flmRed de1ces/dowuiloads

Premium advertising option control over advertising partners

______________

Statstics on pegs view/piaybacfridcwnJoad/payment behavior aid demographics by title

Search traffic from google.com

is Search on provoed and processed metadata nduang provider name

Multi-level granular brows

Featured areas to support standard partner content

TORSO Easy upload and takedown

Unified dashboard for tracking partners through the pipeline

Low-hassle digitization assistance

Payment mechanism for DTO

______ ____ Advertising option to monetize ag text ads

Easy upbad from web page

GENERATED User tagging raP vod S$fld-tQ-Uend

Peoularily mr

Sowve Standatf team feedback BizOps analysis

ID
How we plan to boost torso content

NCREASED CONTENT ACQUSTON TEAM ACrMTY

ncreased steffing in standard team 42 Fits

-- Fastc-r response to user enquines

Accelerated spup and upload of content

Capacity for proactive outreach

Identify new target torso content owners

Exisling online videx 3lenfgAriy tool

b-house tool fci PSO identifies web sites with onlinevkieo files sorts by

quantity of video by vertical

Largely nutilizwl sofar while parther team has been in reactive mode

untapped resources with fast upioad path

-- Video not yet online Business Census in US regionS tagetin outside US

Prioritization of key verticals functions with propensity to make video

sufficient rwsnues per finy

ncoufltflr4YJpe charged with identifying top XX target content providers

and reachtng out

MPROVED PARTNER VIDEO EXPERENCE

8etter marketln ci new torso conteni

Google Video lg Google Picks Google Partner Pages

Improved product functionaiRy waridng txowee and search corning in 02

Increase partner satisfaction aboulvisibility of content

Increase traffic to partner videos

Positive markethg message and references

Future product functionality later In 2006

---Located versions of video.gooçe.com homepage and uploader tools

Thnsiated metadars descriptions forfirrding videos..

Option for monetization through text ads

-tc -L

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Monefization Potentia of Different Content Types

4-

4-

Low Hoh

Ease of Monetzaton

Coot

-J

Sze denotes traffic potentiai
Video monetization possibilities

Sponsored Video requires high-touch premium content to premium adverfiser matching

needs top content and TV-style CPMs to work

5tI..WflhI Ir.skskt.J.W5 a5

advertising

otpeopte con $vslueto $each

interested in amount advortr movie length minutes if ads per content content advertiser

seeing vIdeo will pay mins er ad stream owner owner pays

Per

CPM stream

911 Loechenge 4.560.448 10.00 $9 82 15 75% 171.017 45604

Amezinjtnin9 Z821234 10.00 $0.01 25 75% 18909 25212

Airbusbuildpiarie 412.772 10.00 $0.01 4128

Odcniiceslsshark 201.412 10.00 0.01 75% 1.511 2014

aSirnpscn-ThesabcnlaareniadeforvSdn 10000 10.00 01 41 75%

to

01

Tip Jar busker or shareware model may deliver strong incentives to user uploaders but

nothing to corporate partners c3oogle would pass through all fees

100000

if of peopie lZilr Rationale

interested in whowill Average $vslueto tartipping

seeing video ip content owner guesses

gil Le theme 4560.448 5% 200 $1I Bc t/p for therflv or interest irolaw hIy-edfr video ersviewers

Aniazim lnn 2521 .234 0.50 212 Viewers inressed -see sih benat/dwywth relent

Airbusbuiidpiane 412.772 0.10% $0.02 Lowiate-60.00ratapiovideo

tehark 201412 2% $025 1007 Viawersimprsssed-seesinbeneflclwmihcoodoonzent

10.000.C 0.10% $025 2500 LowrsieVkstbough4tlpgoestoScn

Text ads familiar Google technology accessible to smaller advertisers can monetize

standard partner and user content Google could keep fraction of ad revenues

8Trnnrtla1 Vi tTTiJ ssa

if of people minutes if ads on value to value to each clicks each

intereeledin niovielength pored Iscreonela sdsper content content advertise advertiser

seeing video CTR CPC mins group Jlirne stream owner owner pays sees

911 Loasethenge 4560.448 0.50% 025 82 20 75% 85508 5701 23802

Amazing ltging 2521234 0.50% 0.25 25 24 75% 9455 3182 12.606

Airbus build piajio 412.772 0.60% 0.25 75% 3096 516 2064

Odocus eats shark 201.412 050% 0.25

easicaSjmon-TheseboolsaremadeforwaJkirl 10000000 0.50% 0.25 41 21

25

basad on Apr$ Q0 aufl aciCeicqepi ASspg ..

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75% 755 252 1.007

12500 50000
Decisions on copyright policy and product features wUl significanfly

impact the activities of the content team in 2006

Priodties of content team

Keep premium and standard teams separate

Bulid premium rationships through multi-property deS

Engage premium partners in supporting crawl and metadata extraction

efforts

Seek multi-language support from existing premium partners

Engage oremium partners on enabling viral clips

Communicate to premium partners no material DAM improvements this year

Engage premium partners in sponsored content streaming ad

testdeployment Ofli otheniæse move premium team to standard content

acQuisition effort

Focus on secuæng non-US and non-English language content deais with

new partners

Await improvements in search and browse to produce real data on user

prelerences to guide further partner content acquisition

Increase staffing and1or resources to content acquisition ops and legal

teams to handle complaints and potential litigation

Lrvit danage thrcugn public pa icy 1nvestor relations press and premium

oartnc mee ngs -r

topoipurnrs ccp1 rttn6hrnŁ brtentcwners aiySj arŁiotwjitt
Potential results of changing copyright enforcement poildes

Likely acceptance among users especily highly media-aware young demographic

Higher trartic higher profile as destination site

11 Increased uploads of user content as well as copyrighted content

Potential to monetize higher volume of traffic

Achieve OKAs on traffic and uploads

Inability to Independently gauge what kind of Impact on traffic other oplions can have

-- Improvements in features and user experience

Modifying copyright protection through applying public pressure through increased collaboration with content owners and indirect pressure through

press and public policy

Some content owners sue Google

Diversion of management attention

Negative PR

Potential monetary damages

Loss of trust from content providers

-- Reduced future access to content

Reduced willingness to partner with other Google properties

Reduced AdSense partnerships and revenues nc just In Video

Inconsistent with assertions in book search and library partner program for respecting copyrights

Press public and potentially courts will see loosening of video standards as sign of overall approach to copyrights

Loss of trust from advertisers

Wish to avoid negative associations

Reduced ad revenues
Speaker Notes Slide

Offer GV distributionipromotional prowess to those who dont have scale

Speaker Notes Slide

P1 In addition to premium content1 torso content presents opportunities for competitive differentiation

Leverage GV promotion traffic tools for professional content owners who dont have scale

Take athantage of more relaxed DRM requirements among this class of owners

Few competitors will have resources or expertise to identify and close large volumes of torso deals

Speaker Notes Slide 12

Everyone hates Chris launch on GV 9/23105

iTunes launch with ABC October 2005

Youlube launch February 2005 Not shown on tirneline

GV launch at CES January 2006

LCBS puts programs on platfoims comcast satellite gv plus their own .com

announces 15 millionth video download from email sent from PaidContent estimating 700k sale sweek Feb 24 2006

SNL Lazy Sunday puts YnuTube on the map episode aired December llth2005 it attracted about millIon online views before NBC asked that it be

removed

AOL launches ln2TV 3/15106

Yahoo says itYs scaling back on original programming March 2006

MN announces re-org big plans new media distribution lets also see if we can find out when they acquired iFilm and when their show on VH1 taking

clips from iFilm first aired ackground bullet on similar clips shows on air and in development the iFilm acquisition was Oct 14 2006 for $49

MillionThe Best of Web Video TV show with VH1 first aired on Jan 13 2006

CBS streams NCAA championships for free and reports it generated $4mm in revenues mid March through end of March 2006

FOX closes landmark deal with affiliates

NBC and Stiliates fomi joint venture for new media dIstribution April 19 2006

GV announces inltiatke to digitize NARA content 2/24/06

ABC announces ad supported streaming trial of top shows announced April 10 20061 trial is for May and June 2006

MSN1 unveils new plans to create original programming Maya 2006

CBS Innertube 5/4/06

Some bullet that speaks to tremendous growth rateNolume of user-generated content

Others This is lot already but skews toward the head content we may need more tail bullets and more about torso e.g GY announces initiative

to digitize NARA content

Message were trying to communicate The market is very young but extremely fast-moving premium content owners have really become more

aggressive and open to experimentation user-generated trend is huge

Speaker Notes Slide

109-0033
13

Overview of Google and our portfolio

Speaker Notes Slide 24

Offer CV distributioWpromotional prowess to those who dont have scale

Speaker Notes Slide 25

Offer CV distributiorVpromotional prowess to those who dont have scale

Speaker Notes Slide 26

Overview of Google and our portfolio

Speaker Notes Slide 28

Overview of Google and our portfolio

It

109-0034