Silliest Argument Ever: Just Because A YouTube Paywall Launches It Means More Money Is Made
from the myths-myths-and-more-myths dept
On Tuesday, as rumors were spreading about YouTube's plans to launch a paywall we reminded folks that Google had actually tried this twice before and no one paid. On Thursday, the folks at HuffPost Live had me join a video panel discussing this. What we didn't realize was at the very moment we were talking about it, YouTube had officially launched the program. You can see the discussion below, where I play the role of the lone dissenter who argues that this is a dumb idea:All of that makes a huge assumption: that enough people will actually subscribe. Yet there's simply no basis for it, and yet people kept claiming it over and over again as if it had to be true. But we know it's not necessarily true, because we've already seen Google try exactly the same thing. Hell, let's take a look at the original Google Video, launched about six years ago, with a similar subscription offering:
This idea that people paying directly is the only "real" business model is just silly. The guy who did a video comment during the panel discussion who seemed to argue that this was necessary because it's "capitalism" doesn't understand economics. A bad business model is a bad business model.
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Filed Under: business models, economics, money, paywalls, video, youtube
Companies: google
Reader Comments
The First Word
“I still say it could work
As a "paywall", I agree, these subscription channels are doomed. But they don't have to be a paywall.Instead, you could have something like "Geek and Sundry Insider" that gives you early access to content, back-stage and/or making of, etc. to dedicated followers of the FREE channel who would like to show their support and get a little something more. I pay $5/mo for one "channel" of content here, so I don't see how paying $2/mo for additional access to a great YouTube channel is that far fetched.
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If it works, it's capitalism. If it fails, it's because of piracy and we need new laws to make sure it works.
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Response to: Jessie on May 10th, 2013 @ 10:40am
FTFY
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Re: Response to: Jessie on May 10th, 2013 @ 10:40am
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They can keep their walled garden and pay for content. Somehow I've managed to truck right along without it all these years. I doubt that is gonna change just because they put up a paywall.
Bob might like it though.
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Also, the model is already a success for Youtube itself. The customers are already there, the ad revenue is already being generated. It'll be just an extra cherry topping that will get some extra in for Youtube. The question is if the paywall option will be a success to the owners of those paid channels.
As for those already yelling that paywalls = more money just ask for numbers and proper evidence. Even the apparent successes may actually be failures: what if by maintaining a free model you'd have 2, 2 times the eyeballs and you could be making much, much more than with your paywall? Speaking of which, do we have any study comparing similar businesses that went paid/remained free for comparison?
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In fact, they are just about as useful as the U.S.'s Mexican border fence.
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Re:
And paywalls do stop theft. They already do a good job with appstore users and they'll eventually colonize the rest of freetopia.
Kim Dotcom may be able to drag this out, but he's already discouraging people from following in his footsteps.
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Re: Re:
That I think is legitimate. But what I cannot see being sensible is trying to use these costs to guard the IP solely. That is quite different from the storage of data. If what you say is true, that paywalls are inevitable for one reason or another, you have still said nothing about how to stop the piracy of the internet.
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I'll bite. How? When? For the sake of argument, let's agree that copyright infringement = theft (which I don't agree with at all, but let's roll with it). Can you point to ONE single example of a paywall that succeeded in stopping theft?
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Re: Re:
The discouraging is being done by the RIAA and MPAA.
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"where I play the role of the lone dissenter"???
Anyhoo, the point is Mike discovers that quality (or at least quantity) can support a paywall! -- Have you given up disparaging all paywalls? (I posted a link last time that proves they're working.) Or is this piece part of the concession?
Again on this topic, you've left out giving your position: is Youtube currently flopping and must raise revenue, or going to flop specifically on this paywall, or are you just writing up a fantasy victory after you lost in the actual discussion?
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Re: "where I play the role of the lone dissenter"???
I will never charge others for my Art.And I will never pay for youtube !!!
www.bigmeathammer.com
Sharing is Caring ! Everything is Free at my Domain !
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Re: "where I play the role of the lone dissenter"???
Anyhoo, the point is Mike discovers that quality (or at least quantity) can support a paywall! -- Have you given up disparaging all paywalls? (I posted a link last time that proves they're working.) Or is this piece part of the concession?
I noticed you ignored that Google tried the same thing before. Twice. And both failed. Not that it will flop this time. It all depends on how they are going to be implemented. But with the proposed pricing it's probably going to be a success only to a few top channles that produce a lot of content....
Again on this topic, you've left out giving your position: is Youtube currently flopping and must raise revenue, or going to flop specifically on this paywall, or are you just writing up a fantasy victory after you lost in the actual discussion?
Is Google flopping? I don't think so. And they maintained Youtube even though it produced only losses for years. Now it is profitable by itself. So no, Youtube is going well.
Is it going to flop on this paywall? Not really, Youtube does not depend on this project. Will the channels flop? Probably quite a few.
As for the last attack it's laughable. There's no winner or loser in that discussion. There is a lot of bs flying (as in saying that paywalls mean more money without any evidence supporting it) but only future will tell how it'll play out before any conclusions can be drawn. Many paywalls flopped already proving Mike's point, some survived (also proving Mike's point since he never said paywalls are all bad but rather they should be carefully implemented). Your point?
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Re: "where I play the role of the lone dissenter"???
Eventually he'll start saying, "HBO proved that paywalls are a great way to fund premium content..." He'll stop saying, "There's no basis..."
It will happen.
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Re: Re: "where I play the role of the lone dissenter"???
You do realize that Youtube is OWNED by Google? If Mike were a shill for Google, he'd be praising the premium channel plan. He wouldn't be criticizing it.
It's been explained to you before, but Louis CK DID NOT HAVE A PAYWALL. You constantly trot out an incorrect definition of what a paywall is.
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Re: Re: "where I play the role of the lone dissenter"???
He's already switched sides to celebrate Louis CK, the great paywaller...
It will happen."
You must be an absolute hit in moon landing denial discussion groups.
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Re: Re: "where I play the role of the lone dissenter"???
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Re: "where I play the role of the lone dissenter"???
Unfortunately, the vast majority of your rhetoric rarely has much to do with the discussions at hand. Even a dissenting voice can be useful if it actually has something to do with the topic of discussion.
I'd suggest you try it sometime, but that would mean you'd actually have to know what the hell your talking about.
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Re: Re: "where I play the role of the lone dissenter"???
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Re: Re: "where I play the role of the lone dissenter"???
His performance, could only be rated as 'poor' to horrible.
Did he address the issues, no.. Did he manage to articulate an alternative opinion... no..
Did he mindlessly repeat his usual mantra and hope for the best.. YES..
was masnick the token 'kook' that they get to present the 'stupid' side of the argument, and flatly deny reality??
Seems like it.
Did Masnick manage to provide any form of convincing argument to support his 'opinion' ... NO.
But you did manage to show that you are a pasty faced, stupid looking comb over guy, who clearly does not get out much.. .. you know. in the real world..
Masnick, you need to watch that video 100 times, and get an understanding of how massively outclassed you were, and how out of your depth, and detached from reality you have become.
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Re: "where I play the role of the lone dissenter"???
No, you're the only one around here stupid enough to take an obviously humorous phrase literally.
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Video problems
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Re: Video problems
It's on the "Stuff We Really Don't Want You To See" channel. The subscription price is only a mere $10,000/month.
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Re: Video problems
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Not to mention the high quality cat videos.
What?
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And if you can sell those 10 subscriber's eyeballs looking at the screen to 100 advertisers over the course of that month, advertising will always make more.
People will subscribe to a channel as a one off. If they pay for a month of a show they will watch all of that show that the channel as to offer and then drop it and move to a different channel.
This decision may be partially based off the claims that people want Ala-cart pricing on cable. The truth is if cable allowed that then hundreds of channels would not be supported.
As much as I dislike advertising, the drive of advertisers to push their product to people will always be stronger than the desire of individuals to part with their hard earned income. Advertising works to pay for content delivery because of this. I don't know if it always will, but I don't see subscriptions being the replacement. If they were crazy eyed Glenn Beck would be happy to be on the Internet only, instead of trying to get cable and satellite carriers to pick up his ... umm content.
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Re:
I might pay for an ads-free experience but that's a big might. My youtube usage is not that high.
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Re: Re:
Cable TV, however, is not such an exception. I don't go that road, regardless of whether the "cable TV" is actually cable, or is YouTube or whoever. If Netflix started showing ads, I would absolutely cancel my subscription.
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Paywall!!!
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Re: Paywall!!!
BitTorrent's free
Youtube's paywall will fail.
Sorry, bob, paywalls don't work. Never have, never will, ever.
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Re: Re: Paywall!!!
http://evolver.fm/2013/05/07/bittorrent-launches-gated-bundles-for-paid-freemium-or-unlockable-c ontent/
Paywalls rule. Ad-supported media eventually turns into the equivalent of those free newspapers filled with ads, edgy cartoons, ads for strip clubs, more ads, and an occasional good article.
Repeat after me, paywalls rule!
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Re: Re: Re: Paywall!!!
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One potential logic error:
Take this from the standpoint of Youtube: The surfer is not going away. The $2 a month or advertising question is misleading, because Youtube will still have tons and tons of free content, and the surfers will continue to do the same. From their standpoint, any money earned through a pay system is a plus and bonus to the bottom line. Surfers will not just turn off their computer and stop because they hit a paywall on a small part of the YouTube universe.
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Re: One potential logic error:
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Re: One potential logic error:
If they're showing ads to the payers, yes. If not then any time they spend on the site viewing premium content is time lost to advertising.
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Are they trying to put TV and movies on youtube? If so, it's simply a service parallel to youtube-as-we-know-it, much like netflix, hulu or what have you. Whether or not it succeeds isn't really something that concerns me. Best of luck to you.
Are they trying to get the current free channels to go behind the paywall? Well, this is something different. I follow several channels, most of them related to gaming or astronomy (I'm a nerd.) I found them because they were free, as did just about everyone else. I follow them because they are free, and I suspect so do many others. Should channels like this try to go behind the paywall, they will have a brutal awakening: their fanbase will be upset, the view count will drop dramasticly, new followers will be about as common as medieval castles on the moon as they are now locked up and their following is plummeting, and profits will eventually (if not immediately) drop. Eventually, they will have to get out from under the paywall, and when they do, they will find that their former customers have gone elsewhere.
There's room for pay-to-view content, but let us hope youtube doesn't try to convince every Joe that this is the way to go.
Why do I go to youtube, instead of netflix or hulu? Because I'm not looking for "professional" edited content with a hefty price tag; I'm looking for something a bit more personal without a price tag.
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In your demented mind maybe but in the real world things are not so cut and dry.
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I still say it could work
Instead, you could have something like "Geek and Sundry Insider" that gives you early access to content, back-stage and/or making of, etc. to dedicated followers of the FREE channel who would like to show their support and get a little something more. I pay $5/mo for one "channel" of content here, so I don't see how paying $2/mo for additional access to a great YouTube channel is that far fetched.
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Re: I still say it could work
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Replacing cable
One thing YouTube has to do is to prove to content creators that it can compensate them better than other options. YouTube tried funding exclusive content studios, but that hasn't produced any blockbuster content and the creators have complained that they aren't making enough money from YouTube advertising. (What some of those studios are doing now is going directly to companies to sponsor them rather than having those companies pass through YouTube.)
YouTube seems to want to expand beyond user-generated content available for free.
If paying studios for original content hasn't been working to everyone's satisfaction, then finding a way to compensate places with a deep library of already created content was probably the next step.
Will it work? I don't know, but if YouTube is targeting cable TV, then it already has a model that has worked and the company may feel it is worth trying yet again.
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Re: Replacing cable
It's not surprising that all forms of media keep coming back to trying to find ways for content users to pay for it, whether through crowdfunding, subscriptions, etc.
The alternative to advertising and users paying for content appears to be data collection, which has its own downsides (i.e. invasion of privacy). If people won't pay, you compile information on them and sell that.
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That's a very dangerous game and one that they might win short term but will lose quickly. If lets say CBS decides to put up a YouTube channel(s) and charge X amount per month for it how long before they start demanding more money or just say F.U. and start their own system run which they have full control of?
"One thing YouTube has to do is to prove to "content creators" that it can compensate them better than other options."
This whole content creator thing strikes a raw never in me. You mean content "distributors", "licenc�", "litigator's" "conglomerates"
Many real content creators are making money on YouTube already or just using YouTube as a jumping point to many other things.
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Re:
Not as much as people think, which is why they are looking elsewhere.
YouTube can be helpful launching careers, but once that visibility is there, many look beyond YouTube for money.
I could pull quite a few articles quoting YouTube stars who say their ad payouts aren't as big as people think. I've saved every article on the subject that I see. Here's one that might be a good overview.
I honestly don't care what YouTube does, but for whatever its reason, it wants to move beyond what it is currently doing. Apparently in YouTube's mind, this is worth a try.
YouTube Execs Talk Up Paid-Subscription Channels - Digits - WSJ
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How disappointing
I'm glad you fought back, Mike, on certain points. But how is the media mogul going to tell me that NYT isn't a paywall that you can easily avoid?
I hate paywalls and when I go on Youtube, I've seen the previews of some of the channels, and I can say, I hate it. If the content is released first on one channel, then the next, that may be okay. But to lock up content and believe that people will pay for it is the same as Isaac Newton locking up his physics notes and hoping innovation won't happen. It doesn't work. Either people will enjoy and pay for it if they have money for support, or they enjoy your work for the eyeballs.
Then to turn on your audience by wanting more than time is really a harsh investment to make. I noticed that most everyone treated the public as if they're stupid (particularly our "content creator") by saying "well, since they're kids, they won't understand this stuff."
Newsflash: Those kids are the next generation of content creators, aggregators, and consumers of content and they have a lot more intelligence than you give them credit for. Yet the true "kids" are the ones looking for more money out of people while giving them more of the same content.
I can't help but feel a LOT of people are going to be shown how bad their position is in regards to setting up channels as paywalls.
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The Jim Henson channel is a good example. If I could pay $3 a month to have complete access to every episode of The Muppet Show, uncut and commercial-free, I'd probably sign up. Nothing like that is available, though; only 23 episodes of Fraggle Rock (which had 96 episodes), and one of those weird preschooler shows.
Still, it's been out for less than a week. Maybe over time they'll expand their lineup and improve the interface.
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Re:
A, Wah, ta, ne, ek, uh, oh, t t t Wer, ni, ber....
We'll call him from now on "articulate Mick".
A word of advice, next time you are asked to do something, where you have to think on your feet, and are required to give something more than your mantra.... DON'T.
You ability to express yourself in person is limited.
and yea, lose the comb over, and get some sun !!!!
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Why not?
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conclusions
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Netflix, spotify
All of that makes a huge assumption: that enough people will actually subscribe. Yet there's simply no basis for it, and yet people kept claiming it over and over again as if it had to be true. But we know it's not necessarily true
Netflix, Spotify
Yet there's simply no basis for it
Netflix, Spotify
So you say "nothing works" except what does clearly work, then you say
But, those work because of different factors: mainly a combination of convenience and a ton of content all together
So, nothing works, except of course, the ones that DO work (but lets not dwell on those shall we).
What annoys me about this is that everyone else was making the same silly arguments that were debunked over and over again on the newspaper side
Why bring up the Newspaper side ?? is this not a conversation about video streaming ?? in the video world as you have provided examples, it's been 'debunked' that they DO NOT work..
Netflix, Spotify
that paywalls lead to a higher quality product and more investment into the content. That's not true if no one pays
So if it is not true, if no one pays, you are saying it IS true if people do pay..
Netflix, Spotify
All of that makes a huge assumption: that enough people will actually subscribe
As opposed to your huge assumption: that people will not subscribe. would you like some examples where people DO subscribe ?? starting with TechDirt ?
Netflix, Spotify
This idea that people paying directly is the only "real" business model is just silly
No, it's downright STUPID, probably why your the only one saying it.
I am sure, even you Masnick are aware that is NOT the ONLY REAL BUSINESS MODEL..
But, those work because of different factors: mainly a combination of convenience and a ton of content all together.
so you are saying that Google Youtube is not able to combine convenience and content ?
Why would you say such a stupid thing Masnick ?
Oh, Google wont work where Netflix and Spotify do work because they do things very slightly differently ?? than when you expect Google will do, or progress towards ?
People are paying for those because of the completeness of the offering. Here, people are being asked to spend between $1 and $10 per month for a single channel of content.
Masnick, you are the last person on earth I would ask for advice on people's spending habits and reasons.
People will pay for things they want, does not matter if it is 1 channel or a million channels, if that channel has things they are willing to pay for, they will pay for it.
Just like with Netflix and Spotify et al.
What annoys me about this is that everyone else was making the same silly arguments that were debunked over and over again on the newspaper side
yet, they were upheld time and again on the video side. So comparing video streaming to Newspapers is a SILLY argument, raised by Masnick.
But we know it's not necessarily true
We also know it is not necessarily FALSE !!!!
Here, people are being asked to spend between $1 and $10 per month for a single channel of content. It may work for a few specialized shows: Game of Thrones? Yeah, sure. But not many others.
Pure supposition on your part there masnick.
how do you know, that's right you DONT.. you are making as many assumptions (and ignoring the glaring examples of where it does work) as anyone else.. probably more so.
where I play the role of the lone dissenter who argues that this is a dumb idea:
role playing now ?? even wondered why you are the LONE dissenter.
I guess you thought Netflix and Spotify were "dumb idea's" too right ??
Or that it was a dumb idea to introduce your own form of paywall and pay for content, perks that you have introduced here on TechDirt ??
Run many successful businesses have you Maskick ?? been an actual player ??
Oh, you talk a lot about what everyone else is doing, making a small living of your tiny backwater hate site.
But what have you done ?? why would anything take your advice, have you a track record with these things??
If you do you have never displayed it here.
Do you have detailed information about this business model, or it's future plans, if so why did you not relate them, if not why talk about it as if you are aware of their plans and it's model ?
Do you think Netflix's model is exactly the same as it was on the day it started ? do you think companies are not able to adapt and evolve, try different things and determine what works and what does not ?
DO you think you have some great 'insider knowledge' and 'finger on the pulse of the world' that gives you power to determine what will or will not work, without even really knowing what it is exactly ?
Probably the reason you are the lone dissenter is your arguments are just stupid, and proven so by the many examples of you being dead wrong once again.
Or your desire to say "it does not work for newpapers, so could not work for video".
As you know, there are many examples of both models working as expected, and well.
who was saying that "the only real model" is a direct pay type ??
clearly there are as many models as people or companies decide to implement, there are many successful models, some direct pay, some not.
so who said that, "people" ?? what people.
It may work for a few specialized shows: Game of Thrones? Yeah, sure. But not many others.
That assumption is based on what facts again ??
oh, that is just what you think, an assumption if you will, a guess from someone with extensive experience in the industry.. oh wait.. with no experience in the industry..
Sold many Crystal Balls recently Mick ?
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Response to: Anonymous Coward on May 10th, 2013 @ 10:23pm
Further, netflix and spotify are inherently different than Google's channels. The former offer huge catalogues of just about any song you can imagine. The latter is only offering channels which carry a hand full of videos. People are willing to spend a bit on a streamable database of bajillions movies songs, but not so much for just a couple
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Re: Response to: Anonymous Coward on May 10th, 2013 @ 10:23pm
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Paywalls
1. to easily circumvented.
2. It's not about money I just don't want you to have my personal information and or credit card #.
3. Information is free and trying to control it is like trying to stop a fire hose with a wine cork.
But probably the most important, at least for me; I didn't even know what a paywall was because I surf the internet via proxy, vpn, firefox without history tracking, or any tracking for that matter, so I have never seen a paywall since they all seems to work via tracking cookies which I don't collect.
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youtube movies for dummies
There are no results found for this word. If you tag a video with it and the video shows up by itself, don't be surprised because you just coded YouTube for that word. Now make it cost 5.95 to watch. Then run your new wild and crazy commercial telling everyone its there in any city. The will crush the paywall once that word you created (it can be a hash-tag folks) finds one result in one city from hundreds of thousands of people sitting back with popcorn to watch it right then and right there at seven thirty or whenever you tell them to watch it. they don't need trailers anymore, ask redbox. Don't tell Netflix is on tv too. Or amazon for that matter, but you might want to tell anyone heading to the film festival about YouTube's local reach through configuration at least. Jeez.
Michael
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