Yahoo! has entered the live personal streaming business, joining a crowded field of companies that are a ways from making any money.

To be fair, this is an experiment, created by Yahoo’s Advanced Products Team. It’s goals are likely educational for Yahoo! engineers, and Yahoo!’s scale will help to lower some of the costs associated with offering end users virtually unlimited streaming. But how does it ever make money?

People won’t pay to stream content unless they have an audience that supports them, at which point they no longer need a free service. Advertising is the only possible answer, and the way ads are delivered will need to improve for it to work.

The thinking must be that everyone’s fame to 15 people will generate a large aggregate audience, made up of many high-value micro audiences that advertisers will pay a high price to reach. And Yahoo!, by opening their API, hopes independent developers will create some innovative interactive video applications while they play.

Yahoo! Live is more about finding new ways to engage microcommunities and learning how to make those interactions more valuable. These questions will need to be answered before lifestreaming and UGC can be monetized to its potential. Once they are, it will offer real revenue possibilites for small scale independent content producers and bring profitability to their distributors.

Tags: Yahoo! Live Streaming lifestreaming microcommunities

This entry was posted on Friday, February 8th, 2008 at 12:34 am and is filed under Streaming, User Generated, Video Portals, technology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.