Sorry for the late reply — yes, I am aware of another thread on this
specific to a Drupal project — it is over at –

http://www.tunaspecial.com/?p=162

We have not had much time to do more with it on our end due to all of
our day jobs. There has been talk via email about creating a Firefox
plugin to do this as well. The fellow who did the Firefox S3 plugin
had expressed some interest.

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Why do this at all?
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Good question — the engineering thing is defintiely a part of it — commercial factors include the rights you give up when you do YouTube — some people would rather pay, than give up rights — also, some corporate content should not be on public sites like YouTube, but does warrant seamless flash video sharing — so, people would be willing to pay costs to cover that.

Also — there are lots of features that YouTube should include, but doesn’t — things that will only come about via competition — e.g. can you get your content out of youtube if you want? Even if you pay? Why not? The technology to do so is trivial — even exporting in multiple formats (flash video, quicktime/win-media for podcasts), but it is not in the commerical interests of sites like these to let you take your media and go elsewhere.

Or is this just engineers doing it for the sake of doing it?

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You could always use Amazon’s virtualized solution to do your transcoding, since you’re already going with S3…..
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We’ve been talking about that for situations where there is plenty of bandwidth. At conferences like BarCamp where it is usually scarce, Ianiv came up with the idea of rolling a utility based on FFMPEG — I think what he did is Java based and can spread the transcoding load across various OS’s

Over on the Seattle Drupal User’s Group thread, Boris Mann of Bryght posted some notes on activity with S3 and Drupal –

There was some discussion / code going on here. There was someone hacking on S3 code, so you should talk to them.

I suspect we’ll see a filesystem module level S3 plugin at some point.

Other modules for your YouTube clone:
* userreview (reviews as nodes, includes ratings) — use instead of comments to get better ratings/feedback
* votingapi — needed for userreview
* views / views_bookmarks: easily make a “my favourite videos” list by allowing video bookmarking; can show lists of most bookmarked videos, etc.; views can be used to build other custom page listings easily as well, including a bookmark for “flag as inappropriate”
* tagadelic — to help with display of the all important tag cloud

The big thing that is needed is a component or helper module for the video module that talks to server-side FFMpeg script for thumbnailing, etc. Note that the video module supports remote file links, so it could be used as-is to host on Amazon S3…just need an easy way to upload to S3 in the first place and get the URL back.