YouTube has begun issuing written notifications to a number of popular content producers that have formed brand liaisons — and integrated those brands into their content — without its permission.
The YouTube Terms of Service states that users cannot post commercial videos without express consent. And while direct interactions between advertisers and amateur video creators may appear to be outside the realms of its jurisdiction, MediaWeek points out the video giant has yet to produce a viable long-term profit strategy.
"And as more brands engage in the practice of paying popular video bloggers to integrate their products into videos—rather than purchasing advertising on YouTube—Google needs to find a way to balance its revenue needs with keeping its most prolific talent happy," it wrote.
"We have a policy, and if we discover they are embedding stuff we will definitely let them know," said Director-Online Sales/Operations Tom Pickett. "We have tried to take a more hands-on approach to see if we can facilitate deals. But [video producers] shouldn't be fearful of getting booted off the site."
Some say YouTube's means of enforcing the policy is inconsistent — or muddy at best. For example, Cory Williams ("Mr. Safety") claims he's incorporated a number of sponsors into his videos without flak from YouTube — as long as he runs overlays and banners on his clips as well. Still others say YouTube simply refuses to promote videos that feature product placements, significantly hampering a video's potential reach.
By and large, however, content producers acknowledge the need for YouTube to at least try skimming a profit from producers and brands that liaise on its tab. "It's not unreasonable," said Marketing Director Kevin Nalty of Merck, who produces a number of YouTube videos under the handle "nalts." "They are paying these high bandwidth fees, and they don't want to be seen just as a dumb pipe."
In the near future, YouTube will announce a more formal process for branded integration into videos. At present the site sells ads against about 9% of its video views in the US, up from just 6% a year ago.