One of the major problems with web video in general is what people expect to get for free versus what companies logically have to make a profit on. Internet users aren’t stupid, we know that it costs money to make things and if those things don’t make their money back, we’ll either get less things or things that are so consumer-motivated that they end up being complete crap (oh, hello Hancock).

The problem with YouTube, the flagship of all web video sites, is that people are so used to the internet being free that YouTube constantly has problems monetizing themselves. Downloadable content? Why not? HD view with 16:9 aspect ratio? Maybe that won’t lead to HD videos of people getting kicked in the nuts.

YouTube isn’t a website, it’s a market. Until Google’s video search function gets a more user-friendly interface, it’s the index of all video content on the web.

That’s why this was so surprising:

And what’s more surprising? This balls-out effort was the digital manifestation of Monty Python realized they were being robbed blind. Then, they took their built in audience and said: “Okay, you’re going to do this anyway, will this lead to sales?” And what’s cooler, they came right out an said it: “Buy our stuff if you like the free stuff.”

And the pinnacle? It might be working…

From Mashable:

Despite the entertainment industry’s constant cries about how bad they’re doing, it works. As we wrote yesterday, Monty Python’s DVDs climbed to No. 2 on Amazon’s Movies & TV bestsellers list, with increased sales of 23,000 percent.

Similar approach worked for Nine Inch Nails and other artists. And yet, lately we hear more about various restrictions to free redistribution of copyrighted content than ever before.

I’m not implying that everyone who owns copyrighted content should give everything for free and simply hope that the fans will send them money. But I am saying you can’t have it both ways; you can’t control, monitor and bully users on the ISP level, and reap benefits from free redistribution of content at the same time. Sooner or later, the entertainment industry will have to choose.

Monty Python is on their way to proving that this works. The only problem being that this method of giving away free content and hoping people pay for it only really works for larger entertainment entities that have enough well-known content to motivate people to buy it in bulk. Radiohead’s In Rainbows was a fluke, because it was Radiohead.

The reason that this method is still not embraced by those who hold the gavel on free web video is because it doesn’t work for videos that don’t have a built-in, internet-rabid audience.

Basically, it won’t generate money until said entity makes something equivalent of the Knights Who Say “Ni.” And we’ve been waiting decades for another Knights Who Say “Ni” phenomena.

Still, this is data that is a step in the right direction. Next step: you guys need ot get used to the idea of paying for something.