You don’t need to be a rocket scientist to know that YouTube have been a big player in the online video industry – for what seems like ages now – and that they’ve successfully outplayed and outwitted many traditional content providers in terms of traffic and eye-balls.

However, the recent announcement made last week stating that they have forged partnerships with “more than 1000″ content providers is both a logical and startling one for all of those concerned with online news. Why?

Well, if YouTube are able to capitalise on their existing audience and all the hype over the last 16 months and manage to move away from copyrighted footage and silly college pranks, it could seriously threaten the likes of the traditional media in the online video space, which is really starting to boom in broadband-friendly countries. This would of course become a logical companion for the Google News site, which has already usurped the traditional news media in terms of popularity and traffic.

Another reason why Google would (or should) be hedging their bets and pilling boatloads of cash into ensuring that the above scenario works out, comes as a result of Viacom’s decision to sue YouTube for a cool $1 billion.

This is what Viacom said in a recent press release:

YouTube is a significant, for-profit organization that has built a lucrative business out of exploiting the devotion of fans to others creative works in order to enrich itself and its corporate parent Google. Their business model, which is based on building traffic and selling advertising off of unlicensed content, is clearly illegal and is in obvious conflict with copyright laws. In fact, YouTub’s strategy has been to avoid taking proactive steps to curtail the infringement on its site, thus generating significant traffic and revenues for itself while shifting the entire burden, and high cost, of monitoring YouTube onto the victims of its infringement.

Don’t think anyone will argue against that point except maybe the Google lawyers. The fact remains, however, that even if YouTube manages to walk away from this lawsuit, it’s only a matter of time before hundreds, no, thousands of others bang the drum for YouTube’s head on a stick.

The real dilemma that they face, in my opinion, is whether they could retain their massive audience if they were to shy away from the secret formula to their success, namely, copyrighted material and college pranks. I have my doubts, especially with competitors such as MetaCafe and Blip.tv hot on their heels. There is also Joost (currently in Beta) from the founders of Skype and Kazaa, which has come just short of claiming to revolutionise Web TV when it is officially launched.

What does this all mean for the news media and what does it mean for YouTube? Over to the floor…