Yahoo! Pulls Plug on Paid Video Service, Ponders Possible PackagingCNET News reports that Yahoo! has decided to call it a day for its paid video clip service, while considering other models under which to monetize streaming video content on the Web, including a possible fold-in to its Yahoo Plus service. This is just the most recent of a string of concessions on the front of video subscriptions for consumers that sprung up in the "we must make it pay" craze of the post dot-com era. With Microsoft offering ad-supported video that is free to consumers via MSN, it's not surprising that these earlier models are withering away. On-demand streaming video is a highly valuable source of content, but its image quality limitations and competition from hundreds of cable and satellite video channels make it difficult to determine its true value based on the merits of delivery alone. Streaming video needs much more context-oriented content that can be produced around it and add value to the video experience to justify premium prices charged to online consumers. A picture may be worth a thousand words, but having the thousand words on tap that match its value is the true key to online distribution success. It works for audio content on the Web, and it works for video on DVDs, so there's no reason to think that online video content can't consider the same model for success more actively.
