YouTube's Steve Chen: Copy Protection Technology Taking Time

YouTube Co-founder Steve Chen talks about the integration with Goolge and the state of the video sharing services copy protection technology, which is just now in the testing phase, despite Eric Schmidt's claims last month that the technology would be released in a few weeks. Now, it looks like the Claim Your Content system won’t be released for at least a few more weeks. YouTube co-founder and chief technology officer Steve Chen told BusinessWeek that the system is only now “entering the testing phase.” In his first interview since the lawsuit was announced, Chen spoke to BusinessWeek about the secret to YouTube’s success, its plans for growth, its massive technology infrastructure, as well as providing an update on the merger with Google, which closed last November 13. What follows are edited remarks of Chen’s interview with BusinessWeek editor Spencer E. Ante.
Heather Green

My collegue Spencer Ante got a chance to speak last week with YouTube co-founder Steve Chen, who hasn't done many interviews since the Google acquisition. They talked infrastructure, search, and the state of YouTube's much anticipated (at least by big media execs and their lawyers) copy protection technology, called “Claim Your Content.” Though Google CEO Eric Schmidt told the audience at the Web 2.0 conference on April 19 that the company’s copy protection technology would be released within a few weeks, Chen says the technology is just now entering the testing phase.

Q:What has made YouTube so successful?
A:There are a number of factors. First is the explosive growth in laying down fiber lines from 1999-2004, and broadband penetration reaching the majority of users. Also, there’s the ability of users to tape videos. It’s only in the last three to four years where video cameras went for $300 to $400. It was reaching mass adoption at same time we launched. Then there was the ability to support video formats. We support of about 120 different video codecs and 240 audio codecs. It’s a pretty complicated field. It’s been a cornerstone of our success.

Q:Could you have seen the same success if you founded YouTube in 2002 or 2003?
A:YouTube was not the first company to do online videos. Those three factors really needed to come together first. Our work has been taking these three pieces and making a usable product. I don’t know if we would have seen the same hyper-growth.

Q:Did the cost of bandwidth inhibit your business model?
A:We had $11.5 million in funding. Fear of spending too much money kept us up most nights. We needed to make sure we could continue to scale in a cost-effective manner without going bankrupt. We built a video distribution network. It takes a lot of hardware to be able to trans-code the videos because they are not coming in the flash format.

Q:How big is your technology infrastructure?
A:The ecology of the network is worldwide. We’ve seen explosive growth not just in the US. We’ve seen a lot of growth outside of the US, in Asia, Latin America and Europe. We are continuing to build a network that serves people all over the world.

There are three phases: The first phase is capturing video and being able to upload the video to YouTube. We want to remove as much burden from the user. They can click on the attachment and send it to YouTube. The most complicated phase is what we have to do with the files once we get them. We also generate stills and thumbnails about the video. We format the video and correct the sound and replicate it across as many of our data centers globally. We try to place the video as close to users as possible. Then we put it into the search engine and make it available.

Q:How many data centers have you built to serve these videos?
A:We use external providers. More are coming up every month. I can not disclose the number of data centers we have.

Q:Is it more than ten?
A:In California it is. Every time we put up more data centers it is closer to the user. It doesn’t have to be big.

Q:What are your integration plans and where are you in the process?
A: This is now the new list of things that keep me up at night. It was a really good marriage of companies. Philosophically we are very passionate about the technology. The other aspect is we’re very much about getting stuff done.

Q:A lot of the integration work might have been different if someone else bought us.
A: As soon as the acquisition was closed we started moving engineers over to Google. The content, sales, and business teams are working with us. They are not interested in gutting YouTube and making it their own. They’re very interested in maintaining whatever it is that makes us special. We’re keeping the office separate. Chad and Michael keep running the company. As soon as the food started showing up from the Google kitchens everything started turning around.

Q: Have you integrated any of your technology operations with Google?
A: Yes. The amount of data and size of what we’re talking about takes a lot of planning. We’ve been doing some stuff, 5%, 10%. In a lot of ways we continue to work with the Google architecture team.

Q: What kinds of new products and services are you working on and rolling out in the near term?
A: For 2007 there are a few areas we want to explore. We are looking at other content partnerships and continue to explore beyond the desktop. We’ll continue to work on the community features, and connect people, bringing these communities closer together. What makes YouTube really successful is you know someone created that video on the other end. We would like to continue to find other pieces of content. Cooking videos may not be interesting to someone else. But we want to be able to create these min-communities around certain pieces of content. And we will continue to explore international options, making more a local experience for users, like creating a most-watched list for the Japanese audience.

Q: You’ve seen extraordinary growth, up 251% in your audience and people spend an 42 minutes per visit to the site. What kind of growth will you see in the future?
A: When you look at the history of YouTube it all happened in 18 months. It’s an area moving at 800 miles per hour. A lot of effort is just trying to keep up and looking for what the community wants. There will be more bandwidth put in, better quality content, and continuing to work with the premium content providers and make them see YouTube as a place to distribute their content.

Q:On that note, what’s going on with the technology you are developing to protecting copyrights?
A:We are working on a system called “Claim Your Content.” We’re really excited about creating a solution that lets content owners claim their content. It’s entering the testing phase. We’ll continue to evolve the product over time.

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