Move over traditional media.

While rightsholders have long used partnerships with newspapers, radio stations and other traditional media outlets to build exposure and access new revenue streams, a growing number of properties are finding similar success with YouTube, LLC and other online content distributors.

Like old-school media companies, online content distributors offer properties three major benefits: promotional support to drive ticket sales, access to new sponsors and activation platforms for existing partners.

But the similarities largely end there. Content distributors can provide greater reach and access to more sponsors than traditional media outlets.

“YouTube is like a media partner on steroids,” said Chad Issaq, executive vice president of partnerships with Superfly Marketing Group, the marketing arm of Superfly Presents.

Like other music festival producers, Superfly has generated incremental revenue by selling sponsorship to webcasts around the Bonnaroo Music & Arts Festival in Manchester, Tenn. and other events that it owns.

For example, four companies sponsored this year’s Bonnaroo webcast: Ben & Jerry’s Homemade, Inc.; Ford Motor Co.; Microsoft Corp.; and Comcast Corp.’s Xfinity cable service. The webcast was hosted on www.Vevo.com/Bonnaroo.

Content distributors also are signing new deals with pro sports teams. Case in point: Manchester City Football Club earlier this month announced a new partnership with YouTube. The deal marks the first commercial partnership between the video sharing giant and a Barclays Premier League team.

Man City is using the partnership to support its strategy of engaging fans around the world. The tie affords a dedicated channel featuring behind-the-scenes content created by its in-house production department.

“Manchester City is having a phenomenal year of growth and development online. Our goal is to deliver market leading experience for fans in terms of online video. That means delivering the great content we make to where the audience is—i.e., on YouTube,” said Richard Ayers, the team’s head of digital.

Other players are joining YouTube in aligning with sports teams. For example, Ustream, Inc. earlier this year inked a new tie with Brazilian soccer club TV Corinthians.

Revenue-Share Agreements Drive Deals
YouTube and other content distributors largely align with sports teams, music festivals and other types of properties to accomplish one primary objective: access content that can be monetized.

Indeed, in-demand content is playing is playing a major role in YouTube’s effort to attract and, perhaps more importantly, retain viewers.

“The YouTube platform is very much search-based with heavy user-generated content. They’re reaching out to sports teams and other types of properties to gain premium content and better compete for advertising dollars,” said Devi Mahadevia, the NHL’s director of digital business development.

The NHL is placing more focus on upselling corporate partners on content around its dedicated YouTube channel, said Mahadevia. That includes enhanced content around the Bridgestone Winter Classic and the league’s other tent pole events.

“YouTube offers a large, diverse audience. It’s a platform that’s important to us as well as our sponsors.”

Partnerships with YouTube and other online content distributors typically work in one of the two following ways:

Distributors seek pass-through rights for advertisers. In the most common arrangement, content distributors approach rightsholders about content that can be passed through to advertisers. The distributor then bundles the content into integrated packages that can include webcasts, online inventory and other assets.

“We tell them how much we want for the content, and they bundle it in a media package for a third party,” said Issaq.

Similar to deals with traditional media companies, the advertising packages can include on-site sponsorship inventory.

For example, YouTube in 2009 worked with Superfly to create an integrated marketing package for T-Mobile USA, Inc. around San Francisco’s Outside Lands Music & Arts Festival. The package included sponsorship of the event’s webcast, a media buy on YouTube.com and on-site assets to promote a new cell phone.

Content distributors and advertisers cover webcast production costs, said Issaq.

Rightsholders upsell existing partners. Properties can use webcasts as a sponsor activation platform.

For example, Ford in 2010 sponsored the YouTube webcast of the Bonnaroo music festival to support its sponsorship of the event. The auto maker sponsors the fest on behalf of the Ford Focus,  a vehicle marketed to young tech-savvy consumers.

More recently, The Art Institutes Int’l LLC this year supplemented its new Bonnaroo sponsorship by presenting the webcast of man-on-the street comedy performances from the Bonnaroo Comedy Team. The content was broadcast through ComedyCentral.com.

On the sports front, Man City’s YouTube partnership gives the team the right to sell advertising on the team’s channel, an asset it plans to offer sponsors.

Things to Consider When Striking Deals With Content Distributors
Below, IEG SR highlights five things to consider when exploring partnerships with online content distributors.

Consider different deal structures. Deals can be structured in many ways, ranging from revenue-share arrangements around pay-per-view events to subscription-based offerings.

For example, the Corinthians soccer club is leveraging its Ustream partnership by offering pay-per-view game broadcasts.

Know platform options. Properties should have a good understanding of a partner’s technical capabilities before striking a deal. Questions to ask: Can a webcast or other content exist on a Facebook page or mobile app?

That thinking played a role in Superfly’s decision last year to host the Life is Good festival webcast on Livestream.com. JPMorgan Chase & Co. leveraged its sponsorship of the event with a tie-in to the event’s webcast; the webcast was hosted on the festival’s Web site as well as the credit card company’s Facebook page.

Play up impressions. Properties that want to upsell existing sponsors on webcasts should play up cost-per-thousand metrics when making a pitch, said Issaq, noting that most companies fund online deals out of media budgets.

Downplay official sponsorship status. While YouTube has received official sponsorship status at the Sundance Film Festival and a handful of other events, the company typically is more interested in content than brand exposure.

Know who to contact. Key decision makers at YouTube include Chris Maxcy, head of content partnerships, and Dana Vetter, music marketing manager. Jeff Nathenson, head of sports partnerships with YouTube U.K., spearheaded the company’s Manchester City partnership.

Suzanne Tran, senior director of business management & marketing, manages Ustream Inc.’s strategic partnerships.