Mark Cuban tells YouTube how it should make money

Cyndy Aleo-Carreira — Wed, 09 Jul 2008 15:28:36 -0700

When entrepreneur Mark Cuban gets an idea, he isn't the type to keep it to himself. He's known for riding the crest of a wave when it comes to Internet technology, and all that high riding has inspired him to share how to fix YouTube's money problems and that of the movie industry too.

The plan he presents for YouTube on his blog explains that YouTube's biggest problem with monetizing its content is sorting through the material to ensure copyrights aren't being violated and verifying submitters' ownership of the content. His suggestion involves Google funding a huge data center (hey, doesn't Google have a couple of those?) and training more people to do what YouTube already has people doing: checking content for possible violations and rights, leading to more monetizable content. He uses a fairly conservative estimate of an increase in revenues to $500 million if YouTube were to increase the amount of content being monetized from 4% to 20% of the available content on the site.

In his second plan, Cuban wants turn the way the movie industry distributes films upside-down. In an interview with Wired, Cuban details his plan to air movies produced by his company Magnolia Pictures on pay-per-view television before they are even released in theaters. The first film released this way will be Red, opening in theaters August 8, but available via pay-per-view several weeks earlier, on July 18.

In the interview, Cuban makes two assertions. The first is that his company will never add any sort of DRM to its movies, and the second is that he doesn't think Hollywood would even follow the model he's launching this month. I'm willing to bet that if his experiment succeeds, Hollywood players will be lining up to distribute movies any which way they can.

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