Part 4 of our series on Tech Crunch is up.  I updated our rudimentary pyramid from 2007:

with this one.  It’s a work in progress and I will add more layers to it:

A few notes on it:

- Triangle represents all video content online

- The line above UGC represents professional content, be it super premium, premium and prosumer.

- Circle represents content producers; outside of circle represents aggregators.

- The Profitability Index captures

a) Profit margin on operations,

b) Total Return on Investment as measured by income and capital gain,

c) Likelihood of positive Liquidity Event.

- Center of circle represents highest Profitability Index because production costs are lower and rights are less restrictive. It is also the best risk/return adjusted investment opportunity when measured by ROI.

- After all, only the #1 aggregator has real value, though the #2, 3, etc., content producer can still have a lot of value to a would-be buyer.

- DailyMotion, Veoh, Metacafe, Break and YouTube all began as aggregators of UGC and then shifted towards premium/super premium content, but today they house everything.

- Break, in particular was an aggregator of UGC but is now moving towards more and more premium content and is producing premium content as well after acquisition of HBOlab aka Runawaybox from HBO.

- UGC Producers splintered into Prosumer and UGC, clearly some of the top prosumer producers are massive commercial / promotional endeavours now, some of which even have successful ad models.

- The budget levels and production quality within Premium varies considerably.

- Super Premium producers will need to offer more online to remain on top over time as Premium producers embrace the Web and offer more content to users.

Now read the Post.

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