"Google is clearly trying to get ahead of the wave," principal analyst Rob Enderle of the Enderle Group in Silicon Valley said of discussions the company was having with copyright holders. "The do have deep pockets, but no company has unlimited pockets and the whole goal here is to provide content to users."
Among the risks faced by Google is that if it changes YouTube too much, notoriously nomadic Internet users will migrate elsewhere for video clips.
"It makes sense to try to convince the movie industry to let this thing go and the movie industry really should let this thing go," Enderle said. "There is mutual interest. You'd think they'd want people sending movie trailers to all their friends."
More than 100 million video clips are viewed daily at YouTube, which was launched 18 months ago in San Bruno, California. Google continues to operate its own such website, Google Video.
The company was expected to apply its expertise at generating revenue from online advertising to YouTube.
YouTube supporters point out that most of the videos uploaded to the website are original works by amateurs who gain online fame for stunts such as mixing Mentos mints with Coca-Cola, or making parodies of songs.