After learning about my move to b5media, a friend of mine, Mike Urlocker, urged me to read Peter Drucker's Management: Tasks, Responsibilities, Practices. Given it's a monster of a book, he suggested I read the chapter on "Defining a Business". Drucker's writing is pretty dense so it took some time to get a handle on the crucial point he was expounding: focus on the customer, and what they want, what they need and, most important, what they will buy. It seems like pretty straightforward advice because the customer is always right, right? But the more I thought about it, the more it's probably something that doesn't receive enough attention. For many businesses, the focus is on the product or service, and then trying to figure out how to convince consumers to buy it. There's nothing wrong with this approach but if you meet the needs of the customer, the rest of the equation (sales, profits, etc.) should fall into place - at least in theory. Apologies for another YouTube reference but the secret to it success is it provided consumers with what they wanted: easy access to video content when they wanted it. Of course, YouTube needs to focus on its other important customer, the advertiser, but the company's popularity is a pretty simple proposition when you think about it.
Update: Speaking of Mike Urlocker, he has a post, including a citation of Peter Drucker, that questions YouTube's value. "Is that worth $1.6 billion? No, because YouTube has no base of paying customers. For all the hype of Web 2.0 and other nonsense, there is no better indicator of a bad business than an absence of paying customers."

Mark Cuban may have missed the mark when he refused to believe Google would buy YouTube but now that the deal's getting done, his unorthodox stance on the $1.65-billion marriage shouldn't be ignored. His post today - somewhat hard to find amid the blogosphere tsunami unleashed yesterday - raises an excellent point: with YouTube poised to become of the Google empire (and bidding a champagne-drenched farewell to its status as a scrappy, peoples' champion start-up) how long will it take before Google's major rivals (e.g. Fox, which owns MySpace, which also delivers a lot of video) unleash their legal hounds on YouTube? After all, Google will be a major player in the video business so why would content owners let it use unlicensed material to support the YouTube's growth. The other side of the coin is Google may be content to deal with any content issues if that's what it takes to own the world's biggest online video brand. Two other points before you go onto to read everything you ever wanted to know about YouTube: 1. YouTube was started in 20 months ago; it raised its first round of VC last November, and talked about an IPO a few months ago. It's been a wonderful, wild ride from Chad Hurley and Steven Chen; and 2. Sequoia Capital, which also had a major stake in Google, could see its $11.5-million investment in YouTube be worth as much as $500-million. Sweet.
Update: Nice to see the New York Times has finally caught up to me - :) - with a story about how Sequoia was the only VC to back YouTube. It is interesting that Sequoia was able to corner the deal, particularly when YouTube raised a second round after it had gained some serious traction.