Is Apple Building Their Own YouTube Competitor (iVideo)?

Is Apple Building Their Own YouTube Competitor (iVideo)?

Steve Rosenbaum, the CEO of Magnify.net and the author of Curation Nation, has an interesting editorial piece over at The Huffington Post today where he suggests an intriguing new service might be in the works at Apple: a YouTube killer. He cites several pieces of evidence and recent Apple news that he uses to draw this conclusion, and ultimately predicts that Apple will announce their own video sharing platform sometime later this summer. He even suggests a name: iVideo.

The Evidence

Rosenbaum points out that Apple has just announced a pending price cut in Final Cut Pro--actually, it's a new version of the video editing software, called Final Cut Pro X, which will cost only $299. That's pretty exciting in and of itself, and I almost wrote an entire article just on that. Final Cut Pro has long been the industry standard for video editing, and putting its power in a software that has a middle-class price point could be huge for amateur filmmakers.

He also talks about Apple's existing infrastructure for creation and distribution--they make video-recording devices and run a fairly popular marketplace known as iTunes (you might have heard of it). If they wanted to complete the circuit, the only portion of the video creation game they're not involved in right now is a sharing platform.

Probably his most compelling piece of evidence is the news of Apple's new data center, which he says is larger than any they've ever built. He's even got video of it:

As Rosenbaum points out: what on Earth could Apple need with a data center that is five times as large as any other they own?

Reactions & Reflections

I'm not a genius. And Mr. Rosenbaum has far more experience and expertise than I do, but with that being said... Apple is not building a YouTube killer, for several reasons.

1. I think we're well beyond the point of a YouTube killer even being possible. YouTube is so far out in front of all other competitors that the best any newcomers can hope for is a distant second.

2. This doesn't seem to fit Apple's core business model. I'm used to Apple's software solutions directly supporting their hardware. They make an OS, but it's made to power their computer hardware. They built iTunes, but that was designed to support the iPod. An Apple version of YouTube wouldn't necessarily be a direct support for apple products. I mean, sure... they have some cameras on some iDevices... but they don't specifically make video cameras. They don't make microphones. And many people who might use an Apple-branded YouTube wouldn't use Apple devices to make their films... they'd use Canon devices, etc.

That certainly doesn't mean I'm right and Rosenbaum is wrong. All I'm saying is that usually when I see Apple making software, it's because it directly supports one of their hardware products.

3. Apple's niche is still pretty small, compared to the whole. Are there enough Apple fans who are so loyal to the brand that they could support an Apple online video community? Maybe... but I doubt it. A ton of YouTube's biggest stars are Apple fans, using Final Cut Pro and a Mac to edit and produce their videos. But those people aren't going to leave YouTube, where they're already making tons of money and already have subscribers and fans... that would be career suicide. But for an Apple-branded video portal to work, the mega fanboys have to lead the charge.

4. Apple typically prefers to make money, not lose it. Am I the only one who remembers how many millions (billions?) YouTube has lost by serving up video bandwidth? In fact, while they're definitely making money these days due to their innovations in video advertising, I've yet to hear an official announcement that YouTube is finally turning an actual profit. Does Apple think they can launch a video portal and instantly make money on it? Because I don't think they can. And if they can't... then that means they're treating it as a loss leader, which just makes no sense at all. But... Apple does make a ton of money, and can probably stand to lose some if they see long term potential in a video community.

5. If they wanted in the video platform game, why didn't they do this 3-4 years ago? I mean... all the circumstantial evidence (minus the data center) was still around back then... they had video capture devices, iTunes, and editing software back then as well. Why wait until now?

Conclusions

Of course, I could be way off. Apple could surprise me and announce their own version of YouTube. It wouldn't even remotely be the first time I was completely wrong about something. I'm actually getting pretty good at being wrong on this kind of thing. But at first glance, this feels like a bit of over-inflating of the facts. Or maybe wishful thinking.

As Occum taught us, the simplest explanation is often the right one. Is it possible Apple's new data center is just a mammoth new data center that they intend to provide for them well into the future--like maybe they built it larger than they needed so they could expand into it down the road? Could it be that one or more of the old data centers are about to close, and this new one will take over?
One thing's for sure... if they do release their own online video platform, it'll be huge news... and just the latest in a long line of moves escalating the rivalry between Google and Apple.

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About the Author -
Jeremy Scott is the founder of The Viral Orchard, an Internet marketing firm offering content writing and development services, viral marketing consulting, and SEO services. Jeremy writes constantly, loves online video, and enjoys helping small businesses succeed in any way he can. View All Posts By -

What do you think? ▼
  • http://timschmoyer.com/ Tim Schmoyer

    I agree with you, Jeremy. The only other factor that wasn't considered, though, was Google's move to WebM codec whereas Apple wants to support H.264. I'm not sure that's reason enough to build your own video-sharing platform that's opposed to YouTube, but it could be another check-box for supporting the venture.

    Secondly, the future of Apple TV could be considered as another reason Apple wants to control video content, too.

    But I, too, would be surprised to hear the announcement of a video-sharing site unless they're also releasing a new complimentary device to the site that we don't know about.

    • JeremyScott

      Yeah, I think if they were to move into content creation, the way YouTube plans to, then with Apple TV considered this kind of thing makes a whole lot more sense. Just seems like a steep uphill climb to jump into this market now.

  • RV

    I agree with your counter argument. I think if Apple releases a new TV product it will probably be closed software inside of closed hardware that lets users access content from the cloud that was purchased through Apple - in many ways similar to Boxee and Google TV.

  • mcobrien

    I have to agree Jeremy that Apple would be spiting into the wind in trying to create a video sharing platform to compete with Google. Jobs is smarter than that. If there is anything to this I would have to think that Apple has something they feel is both innovative and will make a profit. Though I can't imagine what that would be in the video sharing domain, Apple has had a rather impressive record over the past decade of not asking, but telling us what we want. Jobs is a genius who knows how to create desire, one of the few. Then again, this could just one big data center.

  • Varvid

    I agree that the likelihood of an attempt at a YouTube killer is pretty far-fetched. This seems more likely to be Apple setting up cloud music (and video) storage for their iPod/iPad lines, so they can make them cheaper and smaller without the need for big hard drives.

    -Riley Adamson
    riley@varvid.com