By Lex Davidson

At a startup dinner this week, Youtube CEO, Chad Hurley, announced that Youtube is close to implementing their direct response marketing units.  This is not a surprise since Venturebeat’s MG Seigler broke this story in February of this year.  However it does appear that we are close to seeing this program go live.  And it made me consider a higher level question, “Is Youtube goint to go open?”  Integrating the API’s from iTunes and Amazon could simply be a testing ground for a larger scale developer platform that would allow for ANYONE to integrate their API’s into the Youtube platform in order to develop additional monetization and engagement components.

Before Facebook opened their platform to everyone they first had test applications that utilized the system to ensure that it was scalable.  At the end of the day, video content management is built upon metadata which can be treated just like any type of data, which means that developers could connect information supplied by the content creator with their own application.

Here is a quote from Google’s CEO, Eric Schmidt, and I believe he may be hinting at the eventual opening up of the Youtube platform to developers,

“We believe the best products are coming out this year. And they’re new products. They’re not announced. They’re not just putting in-line ads in the things that people are trying. But we have a number — and, of course, Google is an innovative place. The Yahoo! team are trying various new forms of advertising, ones which are much more participative, much more creative, much more — much more interesting in and of themselves. Google believes that advertising itself has value. The ads literally are valuable to consumers. Not just to the advertisers, but the consumers.”

His mention of new products that are more innovative than in-line ads makes me believe that they will live by one of the Google ten rules: “4. Democracy on the web works.”  I could be going out on a limb, however I have to think that Google is too far on the cutting edge to only allow for Amazon and iTunes affiliate partnerships.  If they wanted to sell DVD’s and MP3’s they could have very easily closed direct deals with labels and studios.  Their traffic by itself would have made them a considerable force in the digital distribution business overnight.  The fact that they are integrating API’s from third party applications makes me truly believe we are close to an announcement of them opening up.

If Youtube would open their platform to developers they would be able to gain a dramatic portion of their already dominant market share in the online video business.  If community members could add applications that “spoke” to the videos it would make for a next generation video experience.  I’ve called for this type of platform integration, however no one has been able to do it successfully yet, Youtube might be the first.