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Don't get me wrong, no offense, no fight, but... your question sounds pretty meaningless.
Running a cloud with hundred thousands self hosted videos means a lot of tech knowledge, so an easy question like yours should be already in your pocket.
Embedding is the easy way alot of very popular sites use from ages, often overcoming many self-hosting tubes.
Have you ever got a look at alexa.com ? Alexa's top sites list shows it very clearly.
Anyway, to give a quick and easy rely to your question, it all depends on your business strategy.
From your question I assume you have little tech knowledge, however i can tell you:
- if you want to keep the traffic on-site you'd probably need to host the videos, but is your strategy optimized enough to invest thousand dollars per month for the infrastructure?
- if you only care about growing a domain for reselling it later or maybe you just want to publish ads and don't care about the traffic redemption the embedding option sounds way better.
So, the real question you should ask yourself is: what's my strategy?
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