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Will Youtube kill Indie films?

Remarkably, my classes have crossed over. Finally!!! I'm in 3 econ classes right now so it's a pretty rare occasion (i.e. this is the only time it's happened. Ever. I'm nothing short of amazed.) We talked in class about what media executives' biggest worries should be right now – the falling cost of producing and distributing digital media (e.g. YouTube) or piracy. According to Hal Varian, who Wikipedia calls "a central academic in the economics of information technology and the information economy," piracy is not nearly as big of a problem for media execs as cheaper technology.

Varian says the problem with YouTube for big media corporations and Hollywood's most prized celebrities is that when people sped more time on YouTube they spend less time oing to the moview. This is bad for big media corporations as well as for stars since the only reason why Brad Pitt or Julia Roberts can command such exhorbitant salaries is that there is such a large number of people who are willing to pay to see their movies. With more time spent on YouTube, the demand to go see these films will decrease. Consequently, Brad and Julia will have to take a salary cut.

According to Varian, costs of production other than stars' pay will remain the same. Stars' salaries are really the only cost of production that depends on demand for the product they produce.

On the other side of things, the cheaper editing software becomes, the more amateurs will start making videos to put up on Youtube. Varian says, "The more time people spend watching Lonelygirl15, the less time they will have to watch Mr. Cruise", which will reduce Cruise's salary.

He expects to see an increase in creative, cheap, semiprofessional content available online. He likens what we are about to see with digtial content to what happened when printing andbinding technoloty led to cheaper books and more demand for authors. He says that video will be an even better form of media in the future because there will soon be a big increase in its variety.

Sadly though, Varian seems to think that YouTube may cut out filmmakers, actors, and writers who are neither strictly YouTube bound nor the type to make big Blockbuster hits. He says that they will not be able to compete for attention with video blogs nor will they be able to capture big audiences in theaters.

This is a strange thought to me, although I don't necessarily disagree with it. YouTube seems to be of the same mindframe as indie films – big media corporations aren't the only ones whose idea should be seen and heard. Ultimately though, perhaps YouTube will kill indie film. I hope this isn't true.

To read more about this check out Varian's article from 10/19/06 in the New York Times, Economic Scene, "Why Old Media and Tom Cruise Should Worry about Cheaper Technology"


That's really interesting. My thesis pertains to Movie Distribution and new forms via the internet, so this article is a great find.

I feel like the movie industry needs to roll with the punches, not complain that it doesn't have the monopoly on production. Getting more ideas out into the public sphere can only help our society. Big Media will find a way; as of right now YouTube provides a way for extremely cheap advertising, and, if desperate, a cheap way to find talent. (I'm referring more to the advertising agencies now, holding contests for new commercials.) I don't see YouTube killing indie film in the near future, just because its structure seems to promote and inspire people to search out the alternative. But we'll see.


i agree with dalynziichic. i don't think youtube will kill idie films. i think it may revitalize the film industry. i think there has been similar questions about digital music, and mp3s, and whether that would undermine the mainstream music industry because now it's easier for people to make "professional-quality" music and distribute it. while it has been true somewhat, where it has opened up new pathways for music, but it hasn't really dismantled mainstream music.