Calacanis : YouTube = Red Bull + 2 Tween Programmers

Jason Calacanis posits YouTube may not have a business model and in Maslow's theory of 2.0 consumer motivators is a closer relation to Bit-Torrent. I think it's a bit more complex - It's a given that early adopters want to microchunk, syndicate, upload and share kewl klips. The Itunes mass then want it easier again and pay $1.99. As Reality Bites concluded : "The Answer is Pizza." Calacanis : "YouTube and other video hosting sites have made it easy to pirate stuff on the web (which is where piracy started), but they shouldn't be positioned as some revolutionary business. It's a silly, little business that anyone could setup in a week. The fact that folks are talking about them being bought for some large amount of money by Newscorp is commical. They are a glorified FTP site with TAGS people! I could set this up in a weekend with two kids in high-school and a couple of cases of Red Bull. In fact, the first two programmers to email me with a decent resume I'll back you guys to build a YouTube compeititor--provided you can build it in under five days." If U2'be does end up with its 'natural owner' I wonder if they would :

A. Keep 'Business as Usual' : Keep running it ala MySpace blogger, and increase legal funds and eliminate content from those copyright owners with equally big legal budgets.
B : Go 100% Amateur : Like Napster did years back after court case, or the Podsafe Music Network-esque.
C : Turn it into the New Itunes Video Distribution Channel : An integrated media player, with their own content and dying shows like SNL to prop up, could use YouTube for an injection of sex. Like the way The Office is more popular on US TV now its on Itunes.

YouTube is a business in the same way Skype is a business, in that it's another cut into a large industry. It's valuation as a business, assuming it keeps it's growth rates up user wise, will depend on whether someone wants to punt on its commercialisation. The fact the content driving YouTube isn't totally "professional/illegal" means it has alot more chance of this outcome than your more blatant rogue P2P TV and movie trading. Like ifilm.com which was bought by MTV for $49m. So it really depends what your valuation for X Factor is. Jason's value is a case of Red Bull and 2 High School Programmers, which is fair enough ;)

"We are thrilled about the acquisition of IFILM. This move is at the heart of MTV Networks multi-platform strategy and meshes with our tradition of cultivating independent and creative brands. We're combining the top brands in all digital media with our global reach and programming expertise to speak to consumers everywhere they live their lives," says Judy McGrath, CEO, MTV Networks.