Small businesses want to get customers to their website. They want to own the relationship with the customer. Everything we do has to be aligned with growing that business, not monetizing content on the video. One of my favorite stories that we ran on The Verge during the pandemic was the explosion of small business TikTok. Pressure washer TikTok is amazing.
I think about TikTok, and I think what kind of goes under-covered with TikTok is that half of the user experience is an enormously powerful video editor with filters, and a huge licensed music library, and the ability to respond to other videos, and on, and on, and on. Is that pushing your team? And it just has to constantly attract our attention. And so, we do think about that a lot. We acquired a company in Israel last year that was basically the business version of AI video editing.
It was founded by PhDs in AI. And they spent 10 years, actually initially from a consumer lens and then moved to the business, like sort of transitioned. How do you make that content super engaging? We have partnerships with all of those destinations. TikTok is way more directed, right? It pushes you towards making a kind of thing. So the way we thought about our video creation tool is sort of as a spectrum.
On one side, yeah, we have templates. I want the flower shop sales template. Like a template that just makes it super easy. And I think the reality is the technology, the tool itself, can be flexible for that. And then, how do we actually use AI to recommend different ways to optimize that video content? How do you do that all in one place?
We have an app on Shopify. Because video increases conversion. But if you think about a business, you want video on your product detail pages, you want TikTok videos, you want Instagram videos, you want video on your website. You want it everywhere. You have that parallel uploader tool that lets you go to YouTube and Facebook. Have you talked about sending the video to TikTok, and Instagram Reels, and all those other places as well?
When you think about that parallel uploader tool and helping creators perform better on all those platforms, the dynamics of those platforms are really different for video. So just from my own example, we publish to Instagram, we publish to YouTube, we publish to Facebook, I think we publish to Twitter. You have to hook people right away in the first five seconds.
No, that is a problem we believe we can solve and are working to solve. We do know what the best practices are by platform. We share that information with our users and we provide recommendations and insights in the tool. I have a big product launch coming up. I have a new story from The Verge that I want to get out there and I want to use video to do it. And big companies that have marketing teams and production teams can do that today, small companies cannot. But the flower shop is making video to convert against something else.
And video is a marketing cost they can use to do that, hopefully in a sustainable way. You can just win the lottery on Snapchat now, which is very funny.
We want to help you create great content. And if you choose to monetize it on those platforms, that is a way that we can enable that monetization. But otherwise, our view is that monetization can take a lot of different forms. It can be ad-based, it can be free to view and then pay later, it can be a subscription, like a Netflix-style subscription service.
And so our view is we just want to provide flexible monetization capabilities of all kinds on a white-label basis. And I think that that is good for the creator economy. I do think a lot of YouTubers would just sign up for your service and let you take a cut and monetize a bundle in that way. Is that just not a big enough business for you? And this is something, by the way, I think Vimeo has experience. We did at one time. We had this thing called Vimeo On Demand.
And there are companies that do that exceptionally well because all they do is live and breathe the mechanics of how to do that. Every decision you make on your website is optimized for that to be a destination that brings people in. And at least for us, we just think the opportunity that we are facing now is so exciting and big. But let me push you. I subscribe to three or four Substack authors. My relationship to Substack is very minimal as a consumer. You could see that for a YouTube creator that opens a Vimeo channel and I just pay to get it.
But we are basically that central hub, that kind of mission control for the creator where they can create all the content they need to create. They can distribute it on different places and channels and as much as we can be useful to them in doing that, we are. And so yes, could we deviate from our subscription model and try and kind of shift the approach? Yes, we could. So that model does exist. So that type of thing, I think, makes total sense.
For sure. And that there would only be a certain number of companies or content creators that can act like a media brand. And honestly, every single year, we are proven wrong around the size of the market.
But I will also say that I think that the number is much greater than we would have realized. I would argue every single one of them could have their own OTT channel and probably make more net revenue if they had an ad-based model and a direct-to-consumer subscription service. But then I actually drive people into my service for other exclusive content and will they pay five bucks a month? Particularly with the TV platforms, they have inverted the relationship between the consumer, their money, and who owns the interface.
Before, you would pay your cable company, they give you a cable box, they would then pay Disney and ESPN and all the other channels.
Now you get a cable box for free, you pay Disney and then they pay Roku, which is totally backwards in my mind. Where does Vimeo sit? I run a YouTube channel, I want you to make an app for us, ingest our video.
We now have published an app in the Roku store. Do you help me make that deal? Because that dynamic is so complicated right now. It is complicated. We do take care of that for you. We help you actually create the apps. So we kind of manage, I would say, the administrative side, but we are not trying to get in the way of the economic exchange there.
I would love, by the way, to find a way for Vimeo to help these creators get better distribution and visibility on these platforms. That was very much my next question, which shipping an app to the Apple App Store—. Is very different than getting people to see it.
It is loaded with pitfalls of whether Apple is going to accept your app, whether the ad tracking you want to use is acceptable at this moment in time, whether Apple is making a competing app that might push you down the rankings.
My whole team would be nodding their heads right now. And the more we do it, we build automated, scalable tools to do this. But for sure, everything is evolving and we do have to then understand it and build ways to serve our customers. The reality, as I said, over 1, channels, across all these platforms and we are there.
And again, I thought the Shopify example is the right one. Think of how complicated that is. You have to manage all these SKUs and how are you going to have your small, little store suddenly be able to charge whatever you want, and how are you going to manage the legal issues, and how are you going to manage the email and support that? Is it you or is it the small business? Do you send the app update to Apple directly, or do you send code to the flower shop who then has to turn around and upload it to the App Store?
And honestly, this is an area where things are changing. I think we have to continually look at our processes and how we work, but our goal is to make it super, super simple on the technology side. You have to have the content, you have to have the marketing, and you have to have the technology. We keep it super simple at an accessible price point, so that all you have to focus on is creating great content and then marketing it.
You have to be the one to bring the customers and market it yourself. The example I would use is Taylor Swift is re-releasing all of her albums. She just re-released Fearless. The Spotify payouts are still going to be small. What makes her money is licensing that song to 50 other platforms.
The real thing is commercial content over here for large businesses. Not primarily entertainment and not monetization. And I think that, if anything, the last year has really shown how much need there actually is for that.
I remember when we started on this SaaS journey, and it was the least sexy thing in the world. I feel like I have to ask you about audio tools. I just call them the hashtag people. The audience is free to take that and run with it.
Are you looking at that as well? Or is that market too small for you? I would say I agree with you. We are not looking at it, and we are not looking at it because we believe in the power of focus.
And we think the opportunity in video is huge and very unsolved, and for us to solve it brilliantly, we just gotta be focused on it.
And I think to be great at it, you have to live and breathe it. You are about to spin off. Public company CEOs historically get a lot of pressure to grow fast into other areas and to take all that capital that is infused by going public into growing really fast. How are you thinking about that shift?
One, I think I really do believe that the market for video software is so large, and we are in such early, early, early days that we can absolutely grow fast by penetrating that market. And again, I think the pandemic has really demonstrated that. We are not planning to be profitable this year. But you have talked many times in this conversation about how you anticipate a flood of competition.
So are you just trying to burn cash right now to build some competitive moat that no one can get over? This is where I would say the IAC discipline has probably served us quite well. We actually were profitable in Q4, for example, even though we were trying to be aggressive in the market, but we have a high-margin business.
Because I would. And success not being optimizing for the highest stock price at the day that you list or in a certain quarter. And so, the way I think of it is less worried about the fending off of the activist. Things are great right now. I know that. And I think for me, those are things like are people engaging with our tools? Are we actually making businesses more successful through video? And are we bringing video to more people? And if those things are happening, I think we can weather any storm.
Adam Mosseri was on Decoder a couple months ago. I feel like they just keep missing it. Or do you perceive the startup competition? We know exactly what we need to build. Login Join. Manage videos New video. Product News. She thinks it's the best job in the world. Share your videos with the world.
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