Is iPhone video recording bad news for YouTube?

The iPhone's new video capture and sharing may be a double-edged sword for YouTube.

(Credit: Apple)

With the introduction of the the new iPhone 3G S, one of the features iPhone aficionados are most excited about is the addition of video recording. Never mind that this feature has been available in a lot of other cell phones for a while; the point is, it's finally here, and that's a good thing, especially when Apple has taken the pocket camcorder concept to a whole new level with the integration of some basic onboard editing tools, geotagging, and, most importantly, a wireless distribution system that allows you to easily share your iPhone clips via e-mail, MMS, or by uploading them directly to YouTube (and MobileMe) with a touch of a button (see Apple's demo).

On the surface, this would appear to be excellent news for YouTube and should rather frighten Flip Video, which has seen its YouTube-friendly pocket camcorders take a nice chunk of the camcorder market (recent sales figures indicate that digital pocket models like the Flip, the Creative Vado HD, and the Kodak Zx1, have captured over 25 percent of the camcorder market in the U.S.).

True, the iPhone's video--at least initially--won't measure up to the higher-resolution "HD" video you see on the Flip MinoHD and the UltraHD. But the samples we've seen of video shot with 3G iPhones aren't too terrible (I assume the 3G S' video will be slightly better). And in terms of sheer numbers, cell phones present a much larger beast than pocket camcorders; Flip Video has sold more than 2 million units in just two years, while Apple has sold close to 20 million iPhones. With that in mind, one could argue that having millions of iPhone owners uploading their lame videos (OK, some will be awesome, but most will be crappy) might not be a good thing for a company that's losing a lot of money and trying to figure out ways to steer users toward sponsor-supported premium content that it can monetize. As some of you are already aware, it costs YouTube a serious chunk of change to host and store all your videos. And while it has a gazillion visitors, it's still way in the red, and probably will be indefinitely.

If I were Google, which owns YouTube, I'd be a tad concerned about the iPhone. We've all seen the incredible rise of the Apple App Store and the tremendous proliferation of iPhone apps, so it wouldn't be too far-fetched to see video-sharing-on-the-go take off with the arrival of iPhone video capture. And when I say take off, I'm really saying blast off--as in, into the stratosphere.

Perhaps I'm wrong. However, funneling more ad-free/no-fee amateur content through YouTube's tube seems to be a recipe for more losses. Not that you should care one way or another. But I thought someone should point it out. You know, in case YouTube ever decides it wants to charge you for a YouTube-sharing app--or maybe a small monthly fee--to upload your iPhone video clips.

That would be dumb, though, right? You wouldn't ever pay for that, would you?

Additional reading: Pocket HD camcorders compared, The cure for YouTube's ills: Charge for uploads.