UPDATED: Jason Calacanis Calls Google Out in His Follow Up To Blog Post ‘Google Wins At Everything’

UPDATE: [2/10/14 17:09]: This is an email sent along via someone else that NMR acquired — not sent directly to us by Jason himself. The email allegedly goes out to all of his followers as a part of newsletter series. Jason’s  email begins directly after the pleasant picture of him. I’ll change it to italics to differentiate where it begins (if you are uncertain as to which picture I am referring).

Okay, Jason Calacanis has a theory about YouTube and Google. I agree with some of it. But I was asked (not by Jason) to present this article rather than analyze it for merit. I was also asked to break it down and paraphrase parts of it, but there’s no fun in that. Jason has something to say about YouTube and I feel we ought to let him say it. For “part one” of his theory, check out this link. For good or bad, the link reads in much the same way as what follows below. Do you think Jason is right?

Also, please note some of the excellent story ideas his “inside source” presents at the bottom. The “Deep Throat” suggests that they can be advanced in future articles, but, well, there’s no time like the present.


1. Why YouTube is the most important product at Google
YouTube is the most important asset in Google’s collection of brands and services. It has a 1b+ users a month.

Over the coming years, the number of people using the service will be 110%+ of the people who have internet connections.

Wait, what?!? How?

Yes, more people will use YouTube then use the Internet itself.

Two reasons:

a. people taking their mobile devices out and saying “watch this video!” to people who don’t have the Internet (aka a smartphone) yet.

b. people with smart televisions will increasingly hit the “YouTube” button on their remote controls–and every TV will have YouTube on their remote in 10 years–pulling the rest of the world in.

YouTube is a more valuable asset than Facebook and Twitter–combined!

Humans love watching video and advertisers covet video ads most.

YouTube revenue will eclipse Google search revenue in the next 10 years. I’m certain.

Given that Google paid $1.7b for YouTube, and it would be worth at least $100b if it was public today, YouTube was the M&A deal of the century.

Google paid for a pony and got a unicorn–with Pegasus wings!


2. Why Google is blowing it
YouTube has unfortunately inherited Google’s odd–some say passive-aggressive or controlling–”we don’t have partners!” position.

By treating everyone the same, Google shuts down any negotiation on price or features. It’s take-it-or-leave-it, and with Google’s search and video monopolies — and they are monopolies — it’s hit the bricks for a few and bite your lip for the rest.

Matt Cutts, Google’s long term public face, was fairly clear saying “Google doesn’t have partners,” recently at an event we both spoke at.


He actually believes this, and he is the most visible person at Google–1,000x more visible than Larry or Sergey (by design).

For 15 years, however, I had the advertising side of the business–Susan’s side–telling my companies what great partners we were!

How valued we were as a partner, how they wanted to deepen the relationship with Engadget/WeblogsInc/Mahalo/Inside/etc.

Heck, even after the Panda update destroyed all of our traffic at my last company, Mahalo, the ad side of the business was calling me saying “why aren’t you publishing more pages to Google’s search index?” and “how can we help you, we value you as a partner!”

Uhh… we stopped publishing because you destroyed our company!

Then YouTube backed Mahalo with seven figures to make content, and they offered us, and others, use of their studio space as *partners*. They host partner conferences constantly, which we have all attended.

But when it came to discussing the revenue split or getting help to make the business sustainable, you are faced with the “Google Death Glare.”

It’s a blank stare Google executives give you when you express a concern, as if you’re talking to someone who doesn’t speak one word of your language.

Anyone who has Google as a partner knows this stare.

It’s just weird, and very Silicon Valley–in the worst way.

Google only sees you as a partner when they need you to run their ads or they need your content to draw in advertisers. When you need help, Google says “we don’t have partners!”

That’s why folks are so frustrated with Google, and I see that tipping over into hate more and more often. The people I meet who run Machinima, Maker and other major YouTube partners exhibit outright hate for YouTube.

That’s bad news for Google.

In fact, it’s fairly clear to this executive, who has been working with Google since Day One, that Google thinks of content creators–artists–as this necessary evil to put their ads next to.

They don’t really respect us since they won everything. If they did, they would listen to our needs and think about making their platform sustainable.

They don’t listen any more really (that is, unless you need help implementing their advertising technology).

Have a question on how to optimize your ads? They’re all ears!

Have a question about the revenue split, making your business sustainable or why you were replaced in search results by their service (see Yelp v. Zagat)? Google Death Glare!

This gives people, inevitably, the message that Google doesn’t care about them, and it builds massive resentment.

That resentment is coming from protesters in the streets (directed at Google buses) and at conferences at $600-a-night hotels packed with media executives.

Resentment of Google has never been higher, which is what happens when #googlewinseverything.

But it could be easily reversed!

(continued on page 2)

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