YouTube Takes Stage at Media Summit
SUN VALLEY, Idaho — Just 17 months ago, Chad Hurley was squirreled away in a Silicon Valley garage running up credit card debt as he and business partner Steve Chen developed the quirky Internet video site that became YouTube Inc.
During the past two days, Hurley has emerged among the main attractions at an elite media summit in Idaho, where the 29-year-old entrepreneur is seizing upon the attention to further his quest to establish his San Mateo, Calif.-based startup as an entertainment and advertising hub.
“There is a big wave of video coming online and these (media) guys want to work with us to stay relevant in this changing marketplace,” Hurley said during an interview with The Associated Press. “This trend in the Internet isn’t changing, so we are working with them to find solutions on how they can embrace what we are doing and really leverage that to help their business.”
Hurley isn’t the only promising newcomer to be welcomed at an invitation-only conference that has brought together the world’s richest media and technology leaders to network and mull possible new directions.
Blake Krikorian, chief executive of Sling Media Inc., also is on hand to extol the virtues of the San Mateo, Calif-based company’s Slingbox, a device that relays programming from a living room TV to any Internet-connected computer.
Like YouTube’s unorthodox Web site, Sling Media’s product might have unnerved long-established media a few years ago.
But now there seems to be a realization that it makes more sense to try to live with upstarts like Hurley and Krikorian instead of pouring a lot of energy – and money – into trying to stifle them.
“There is certainly some level of disruption to what we are doing, but it has been really refreshing to see that some of these leaders are becoming pretty progressive in their thinking,” said Krikorian, who started Sling Media two years ago.
Hurley’s and Krikorian’s presence at this conference while their companies are so young provides another sign of the rapidly changing times.
The leaders of Google Inc. (GOOG) weren’t invited to the annual event hosted by investment banker Herb Allen until the online search engine leader was nearly five years old.
Now, Google co-founder Larry Page and CEO Eric Schmidt are among the gaggle of billionaires attending this year’s powwow. Google co-founder Sergey Brin also had indicated he would be here, but word circulated Thursday that he had changed his plans.
Hurley proved he is quickly making powerful new friends Thursday when he hooked up with CBS Corp. (CBS) CEO Leslie Moonves for a 45-minute sit-down held in a small room outside the closed-door meetings where all the other conference participants had gathered.
During a wide-ranging conversation that could be heard by several reporters working in the room, Moonves seemed to become increasingly intrigued as he learned more about YouTube’s rapid evolution.
Moonves marveled when Hurley informed him that YouTube’s steadily expanding audience is now watching about 100 million videos per day. He asked how YouTube might be able to direct more traffic to Web sites owned by CBS. The meeting ended with Moonves concluding that CBS should start posting daily snippets of its programming on YouTube.
If CBS forges a formal agreement with YouTube, it would mark the Web site’s second endorsement from a major television network in less than three weeks. In late June, NBC announced it would share some of its programming on YouTube as well as buy some advertising on the Web site.
“That was a big, key moment in our history,” Hurley said of NBC’s stamp of approval.
Now Hurley may face his biggest challenge – proving that YouTube can attract enough advertising to become profitable. The 52-employee company has so far been subsisting on $11.5 million in venture capital.
The tremendous buzz surrounding YouTube doesn’t necessarily mean big-spending advertisers will follow, said IDC analyst Greg Ireland. “YouTube absolutely has a great story to tell, but will that be enough to close deals with advertisers?” Ireland said.
The analyst believes many conservative advertisers may shy away from YouTube for fear of having one of their messages appear next to the racy and vulgar videos that occasionally pop up on the site.
YouTube also runs the risk of alienating its audience if more advertising fills the Web site, a factor that could drive traffic to the many other rivals building video libraries.
Hurley is confident YouTube will prove the skeptics wrong. Just last week, Walt Disney Co. ran ads promoting the “Pirates of the Caribbean” movie sequel throughout YouTube’s Web site for an entire day – the first time an advertiser had gone to such lengths.
This week’s media conference has provided Hurley with a prime opportunity to recruit other major advertisers to YouTube. The CEOs of two major retailers, Wal-Mart Stores Inc. (WMT) and Home Depot Inc. (HD), are expected to show up before the conference ends.
Hurley also is hoping to meet with Nike Inc. (NKE) Chairman Phil Knight, who told the AP he wants to make it happen.
“It’s phenomenal,” Knight said of YouTube. “I absolutely think there is a place for it (in advertising budgets).”
Both Hurley and Krikorian will have a chance to make another positive impression Saturday when they are scheduled to make presentations.
Hurley said he hopes to educate the conference participants about the potential of online video.
When he describes the $200 Slingbox, the 38-year-old Krikorian will have a slightly different agenda – one he hopes will strike a chord with profit-driven executives. “I want every single person in this place to buy a Slingbox,” he said.