The Next Step in User-Generated Content

DECEMBER 29, 2008

Paul Verna, Senior Analyst
With so much user-generated media populating the Web and mobile channels, content aggregation will become more important than ever in 2009. In the coming year, expect to see real-time aggregation tools that combine algorithmic approaches with human input—like a cross between Techmeme and FriendFeed.

Techmeme is an aggregation tool that uses algorithms to scan the Web for tech-related news stories. FriendFeed is also an aggregator, but it lets users set up custom feeds to pool content from other social sites.

These aggregation tools will develop from the ground up, much like the content itself. They could make it easier for consumers to find video and other content.

Furthermore, in a climate in which advertising is the main (some say the only) means of monetizing user-generated content, aggregators stand to earn more per visitor than the sites that actually carry the user-created content.

An August 2008 study by YuMe and Collins Stewart estimated that online video advertising CPM rates for content aggregators and creators ranged from $20 to $35, compared with $10 to $15 for user-driven sites such as Bebo, Metacafe and YouTube. In addition, the approximate sell-through rates on aggregation sites were 50%, as opposed to 10% for user-generated content sites.

These estimates put aggregators somewhere between premium sites and user-generated sites in terms of the CPMs they command and the rates at which they sell their ad inventory.

To be clear, the trend at hand concerns user-driven aggregation, and the YuMe/Collins Stewart study looked at professional aggregators. It does not specifically address user-generated aggregation, but it reinforces the need for such tools. The larger point is that aggregation is becoming increasingly important as more and more content proliferates across the Web.

Now that the concept is being co-opted by average users (not just analysts and bloggers), it seems that all the pieces are in place for user-generated aggregation to be a real story in the coming year.