I say this because of the economically suicidal nature of Vimeo’s strategy
When you look at the way Vimeo is run in any sort of detail, the facade that it is independent from YouTube can quickly fall apart.
Lets look at the strategy of Vimeo, the mechanics of its business model if you wish.
1.Vimeo expects content creators to pay to upload their videos to the platform. No exceptions, not even if you upload low resolution videos which would take up less space on its platform.
YouTube on the the other hand pays you to upload your videos to its platform, regardless of the resolution. At worst, YouTube is free.
The key to Vimeos long time success comes down to one thing and one thing only.
A large viewer/user base.
This is impossible if it is charging you to give it content.
Vimeo puts up a massive barrier to its own success, Vimeo handicaps the thing that is essential to its success, ie traffic
So is Vimeo secretly run by YouTube?
OK, so getting past that. Lets us assume that Vimeo wants to cover its hosting costs by charging people to upload videos. Okay. Lets assume that is reasonable, there is one other key aspect of it’s business which also massively handicaps it’s won success
2.Vimeo offers a Video on demand service. If someone wants to watch your video, the viewer pays an amount to Vimeo, which you choose and Vimeo takes a percentage and passes the rest on to you as the content creator.
This sounds absolutely awesome. This sounds like something that could really help everyone, it gives all those people on YouTube who are making great videos a channel where they can earn real money ie money which at the least covers their costs. Except…..
Vimeo in their ultimate wisdom decided to keep only 10% of the video on demand revenue. This is massively less that the industry standard ie YouTube.
Awesome you might say, Vimeo is working in the interests of creators and is giving them a bigger share. Except….
Vimeo does not stop charging you there….
No, in addition to this percentage they want to charge you, the content creator AGAIN, upfront for putting PREMIUM content on their website, content which you believe is so good, you charge people for it and which can be MASSIVELY profitable to Vimeo, content which could pay the bandwidth costs many times over
Again, economic suicide.
Again Vimeo puts up a massive barrier to their own success.
They give you the option of doing something that would be massively profitable for them and they decide to put an upfront fee on that activity…..
Again, an economically suicidal strategy by Vimeo.
Which begs the question – Is Vimeo secretly controlled by Google, knowingly or unknowingly?
-Knowingly ie both parties working together
-Unknowingly YouTube controlling the actions of key decision makers at Vimeo covertly
These two things combined make YouTube the no brainer solution.
But there is a third option, the management at Vimeo simply don’t understand their market, their industry, their audience, the keys to their success.
What I would do.
1.Okay, if you think that no matter what happens, you are never going to make money from hosting movies/videos for free, ie the ad revenue is never going to be enough, charge people to upload their videos. But do this at a break even point or as close as possible.
If your ad revenue is covering 20% of your hosting and streaming costs, charge people 90% of the hosting and streaming costs. If your ad revenue covers 50% of your hosting costs, charge content creators 60% of the hosting costs.
2.You do not charge people extra if you want them to upload revenue creating content to your website. Ever.
You use YouTube’s pricing model. Say you take 40% of the video on demand revenue, pass the rest to the creator.
You do these two things and all of your bases are covered.
You’re charging creators the minimum amount possible to cover your costs. ie you are not losing money hosting videos
And you have a facility which is massively profitable both for you and the content creators. The video on demand revenue covers the operating costs many, many times over.
At worst you have a business that does not lose money
At best you have the most profitable (percentage terms) video sharing platform in the universe.
Vimeo has the name recognition to make this a success
Come on Vimeo, show me your are not secretly controlled by YouTube!
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