Call it this century’s version of payola. Sprint Nextel Corp. (NYSE: S) is asking young filmmakers – a.k.a. YouTube superstars – to “sell out” by dropping an image of the Samsung Instinct into their short video for $20 to the first 1,000 lucky chosen ones and $10,000 for a grand prize.

At a site dedicated to the device, Sprint plugs the new contest in a hilarious short video that’s worth a visit alone. “Shamelessly plug the Samsung Instinct into your home movie … this summer, turn your loved ones into cash with blatant product placement,” a deep-voiced male narrator calls out to viewers. “It’s the greatest product placement home movie of all time.”

As one Sprint spokesman told MocoNews: “We’re paying people to hawk our Samsung Instinct phones in their YouTube videos.”

All you need is a short video submitted to YouTube through Sprint’s site. You don’t need to own the phone or get your hands on one for the video either; Sprint’s site features a tool that allows entrants to embed an image directly into their video (including a hand model) with no editing required.

Sprint’s video clip about the contest – a brainchild of its ad agency, Goodby—includes home movies of a baby crawling, cats fighting, a women giving birth and a puppy, so it’s clear the company’s looking for anything and everything.

There’s a long list of fine print, but here’s what’s most important on the creative side:
—No more than four people in the video
—English only
—Video must be 30 seconds to 120 seconds in length
—No personally identifiable information (last name, address, place of work, etc.)
—No other products, copyrighted material or trademarks may be included in the submission.

Rafat adds: I can’t decide whether this is hellishly smart or pathetic….anyone?