Is YouTube the next Napster?

Gotta love Mark Cuban, an Internet veteran whose seen it all. While the rest of us are talking about how social media is changing the world, Mark is talking about the demise of YouTube. Doesn't make him real popular with the Web 2.0 crowd.

But wait, if you look closely at what he's saying, you'll see it makes some sense. Basically he argues that:

1. YouTube can't consistently provide free bandwidth - Bandwidth is getting cheaper, but it's not free. Without a sustainable advertising model, you can't pay for it. Although there have been signs of advertising life, so far YouTube has had a hard time attracting substantial large advertising spending, especially considering the amount of traffic the get. Unless advertiser and YouTube figure out a way to take advantage of the traffic beyond just putting their latest 30 second ads on-line, YouTube won't be able to afford their current model.
2. Copyrighted material - Where's the first place you go when someone mentions a great moment in TV show they saw or bad call play in a game? The problems is that all this material is copyrighted. When a request to remove the material is made, YouTube is quick to comply. However, if YouTube to figure out ways to make money off this content, you can bet the people who own the content will want a piece of the action.

In the long run, YouTube has some big strategic business problems that must be addressed. They've been a pioneer in creating an on-line video community. Now the question is if they can create a sustainable business from it. - Paul Herring