I was just browsing through the current chatter in online video, and it seems that several people in video production and hosting are having a tough time making some income with their businesses.

Are they blind?

They're just focusing on the wrong thing. This guy has been involved with sites that provide free hosting (think YouTube, but smaller). Hey says that even though there are dozens of sites offering free video hosting, none of them are really making money, and they really just buying each other out to try and get more market share.

The other part of the conversation here is that companies are focusing on revenue generation through ads they carry on their site or added as a layer to the video. They're thinking "old school" revenue model and are about to make the same mistake that is driving people away from TV: people don't like ads!

If they count on revenue from people actually going to the hosting site, then they are competing directly with YouTube. They will have better luck catering to video producers (such as myself) rather than end users.

Why is that?

Because the end users (viewers) of the content could be watching the video in embedded form just about anywhere. At least, that's what they should hope for. If the content is good enough, they may be able to drive people back to the hosting site to view similar videos. That's why they need to attract good content producers.

Making Money From a Show?

Apparently, even if you run a regularly scheduled show, it's difficult to make a good profit just from that alone. One of the producers of Ask a Ninja talks about how he has trouble really "making it" even though he has one of the more popular shows on the internet.

Where the Real Money Is

I'm truly thankful for free hosting sites like YouTube, Revver, Blip.tv, and all the others. Their service makes it possible for people to really get into video and use it to more effectively promote products and services. This is where the real money is - the end product.

But not by selling in your video. Instead, teach! When you provide something your audience wants for free you begin to build trust with them and will feel more comfortable doing business with you. Here's an illustrative example of a guy who offers a voice lesson video course giving part of the lesson for free.

Friends do business with friends, and video is another great way to make that connection with your audience.