Does YouTube turn a profit?
 

I was wonderhing this while I was on it today. Do you think they have more money comin gin than going out?

Yeah I know its Google and a billion dollars is nothing to them, but Im wondering if YouTube is in the black or in the red

no it does not.

Correct.

It did not turn a profit even before Google bought it. Nor has it come close since.

YouTube deserves to lose money because it has made society lose wisdom.

its like $175,000 to advertise on the main index for 24 hours

They don't post revenue for youtube on the Google public discolures. But a research group put their total revenue at about $75 million in 2008.

Do the math.

That makes for a huge loss.

"According to data published by market research company comScore, YouTube is the dominant provider of online video in the United States, with a market share of around 43 percent and more than six billion videos viewed in January 2009.[14] It is estimated that 13 hours of new videos are uploaded to the site every minute, and that in 2007 YouTube consumed as much bandwidth as the entire Internet in 2000.[15][16] In March 2008, YouTube's bandwidth costs were estimated at approximately US$1 million a day.[17] Alexa ranks YouTube as the third most visited website on the Internet, behind Yahoo! and Google.[18]"

Source: Wikipedia

Well, what do you expect. It's not a regular site. Vids require shitloads of BW. Especially now with HD enabled on youtube! Nothing compared to most of our sites with images, text anf externally hosted flv's

they made alot when they bought it off wallstreet when there stock jumped. doesnt matter if it made money or not people bought more stock etc. all hype like most of wallstreet

So they will break even in about 14 years

Dont kid youself youtube makes lots of money u morons.

youtube could cost google millions a day, and it's still worth it for them in their domination plan.

Google can afford to lose money on YouTube just to remain the #1 on that niche. It may become profitable in the future, they are already making steps towards it. YouTube is now the second largest search engine in the world so I think in their eyes that loss is worth it.

Well, Google can afford to lose money on it, but for how long.

Don't forget, they only have one profitable product and everything else pretty much loses money. You can't ride that forever. I'm not saying they are in any immediate danger, but at some point they need these things to become profitable, not just dominant.

If video advertising ever kicks off like it was expected then things could change very quickly, is that not the reason they bought it in the first place because they saw video advertising as the future?

Yep, I agree.

A lot of website types have had this problem in the past. Hell, in the beginning companies didn't even know how to make money off the internet. They will find a way eventually to make huge profit off it.

The big thing holding youtube back right now is the Viacom lawsuit.

Until the legal issues there get sorted out, and they have a clear idea of what they can and can't do, what and how they can advertise etc, they're just going to spin their wheels.

The case law for their business model doesn't exist yet, it's going to be decided by the judge(s) hearing this suit.

All of your answers are invalid unless one of you works for youtube.

Probably still in the money losing stage of any business' evolution.

Good point. It's an open question when the advertising downturn will hit Google. It hit Yahoo pretty bad during the last bust of 2001 to 2003

I will agree with this statement...:2 cents:

damn, this is insane

Google does not release YouTube's numbers publicly so everything everyone says here is just speculation.

Here is the latest guesstimates:
http://www.forbes.com/2009/02/24/hul...idcontent.html

imagine if they started charging $5 a member per month, people that like it would definitely pay $5 a month or $50 for a years access, they'd be making nice money then

It's a tax right off.

I think the important thing for Google was making sure that nobody else owned it.

I think that would kill it. A better, or more viable option, would be to upsell surfers to a subscription service with higher quality videos, and exclusive content provided by content partners (TV networks, movie studios, etc.)

Most of their surfers are 35>

The model doesn't work and never will be profitable.

I would expect the only point of the acquisition was to try to get that huge mass of visitors who are mainly kids used to using the google applications etc. to secure the dominant piece of the pie in the future - a strategical acquisition.

Also, the popular fairy tale that this was started in someone's garage is a non sense.

They had $ 8 M of financing for the start and additional investments afterwards - it's significant for the whole web 2.0. bubble that probably bursted already.

No one will ever be able to pull such a trick again.

Not to mention the whole popularity was only enabled by a loophole in the copyrights, so they could attract people to find their favorite stuff at you tube - all inclusive.

No one is really interested in Johnny from Nebraska playing guitar, everyone wants to see the celebrities, movies stars, music videos, politics, sports etc. - the real thing and real content.

https://youtube.com/watch?v=QjA5faZF1A8 - dude playing guitar, 57 million views.

I'm pretty sure YouTube turns profit :2 cents:

This recession will take a long time to recover from. Companies will be going out of business while other cot their costs. Advertising on a site that can't prove it's worth money is going to find it hard to justify $750 a day.

Go look at the TV stations that live off advertising then think about it on Youtube. Every clip opens with an advert, an advert every 10 minutes and all on a medium used by people who there to not spend money.

Do you see the flaw in your thinking?

It might piss off more people than it encourages. Remember it has fuck all to do with traffic. It's ALL about what that traffic spends against what it costs. Could it be some at Google think traffic is king? :1orglaugh

In good times it's a tax loss, in bad times it's a drain.

I doubt they are making profit from YT
just because the costs are too big...

I have more confidence in hulu.com one day being profitable than youtube.

If fact, I visit hulu way more than youtube. I use to visit youtube daily, but now the only time I watch a youtube video is when someone embeds it on a forum or blog or something.

YouTube is a perfect marketing tool for Google, it's an extremely well known brand

So Google doesn't really give a fuck about bandwidth cost.

I'm pretty sure I've read from a Google blog or something that said YouTube is losing a fair bit of money at the moment but they are making steps to monetize it (like the index video ads), not exact numbers though.

Most of YouTube's users are in the 35 - 65 age range. Only about 13% are kids.

What leads you to believe this?

Yep the Viacom suit will define the future of Youtube and sites like it. If Viacom wins and is given a huge judgment Youtube will either have to adjust how it does business or close down. From what I understand Youtube and sites like it say they are just hosts and have no control over the content on it. Yet you never see porn on youtube so there must be some kind of filtering system in place that keeps it off the site. If Viacom can prove that youtube is controlling the content in any way then their DMCA safe harbor will be pretty much null and void and once Viacom wins every company or person who has stuff on youtube that they don't want there will be filing a suit. Youtube's legal bills could quickly outpace its bandwidth bills.

Where do you get this from. I would think just the opposite that most of their users are 21 and under. Just from what I know about myself and my friends I sometimes look at youtube and some of my friends occasionally do, but their kids are on it non-stop.