Citi: YouTube Can Generate $500M In 2009 (GOOG)
Google famously hasn't figured out how to sell ads in the video stream itself, though it keeps promising that it will. Doesn't matter, Mark says: It can get most of that $500 million from run-of-the mill display ads. This dovetails with anecdotes we've heard from other (much smaller) video sites: Their most lucrative opportunities, so far, haven't been in the videos themselves but on the real estate surrounding it. Think what would happen if someone could actually figure out how to make video advertising work!
Meanwhile, Mark says, some of Google's other non-core projects -- Google Videos, Images, Maps and Finance -- may finally start kicking in some cash, too. He projects they'll generate $265 in incremental net revenue next year.
See Also: Eric Schmidt: Google Has Secret Plan To Mint Money With YouTube
YouTube: Not Such A Money Pit After All?
So if you upload your cat singing, no video ads, no display ads, no nothing ads, and Viacom will argue no category ads either.
Which begs the question, how much traffic does Youtube get to pages with licensed content. Because those are the ONLY pages they can sell ads around, or can package with advertising
the analyst takes MySpace's eCPM and extrapolates it across YouTube, which admittedly is faulty for two reasons:
- as you point out, not all of YT's pages are monetizable
- but those that are, yield more than $1-and-change.
To answer your question:
- indeed the minority of pages might be monetizable, but across YouTube's massive size, I'd guess that enough are for YT to build a decent business.
Disclosure: we're a legal content provider on YT.
Ashkan
Take a look at Nine Inch Nails as a good example. Monetizing content is good for the artist and for Google, and as there are more success stories, there will be more people / organizations that will choose to monetize their content.
Weezer's most recent video has "only" been viewed 7.5 million times... I'm guessing that they're making at least *some* money from that.
http://news.cnet.com/8301-10784_3-9959106-7.html
YouTube monetization chief departs
Wonder what Shashi Seth thinks about this - Seth was one of the best product managers at Google before he took on the YouTube assignment and left in about a year. Looks like somebody left the CHIEF of the analysis.
Or maybe Mahaney is the new self-annointed Monetization CHIEF at YouTube! - aah - the power of "excel macros" - anything can look soooo real - for a while at least - till they tweak the formulas again.
1. Management saying they know how to monetize
2. Content providers bragging about how much money they are making, which in turn would act as digital gravity to every content producer in the world.
Instead , we see YT creating a segregated island for indie film. Smart move from the perspective that it allows them to test what their traffic generating power is off the main YT site. However, it still only gets them content that cant find money elsewhere.
All youtube has to do is put some of that money they use to subsidize the worlds bandwidth costs towards content providers and they change their future.
Hell, they could partner with HDNet to acquire films. Anything that drives cash to indie film makers is a good thing. But the way the market is today, film makers , when given the choice of having their movies shown in theaters on a commission basis, or shown on YT on a commission basis.
Which do you think they will choose ?
2. Yes, I realize YT can only sell ads where they have licenses. Our report tried to lay out a range of caveats. But hard to escape conclusion that YT as a forum is becomming increasingly important to content makers. Those weren't Hulu-CNN presidential debates. And couldn't we see a self-service solution (with rev shares) for cat-singing video producers?
3. Wish we could get the data on the number of legal content providers on YT. Likely that's been increasing, but impossible to know externally.
4. If GOOG/YT doing their job right, shouldn't they be able to monetize better than MySpace?
5. I would never disagree with Mark Cuban.
And as far as YT as a forum, i would say its gone the other way. they are losing their importance. Channels that were announced early as big deals, no longer are, if they are still on YT at all. Wanna bet we dont ever see another YT debate on a national level ? I think the candidates are still embarrased by the whole thing.
Major content providers have been more likely to remove content or replace any content with linkvideos. Videos that are there just to send traffic elsewhere.
In fact, thats what YT has become for professional content creators, not a destination, but a loading dock for other sites or to act as a Hotjobs site for their careers.
Which i think is exactly why they created screening room. As a way to test creating destination sites where they control all the media and advertising, and to see how much traffic they can send.
they want to be a media company, but they are more of a free hosting company.
I also think that Apple and Itunes is also going to be an interesting wildcard in all of this. If they open up and create an easy to upload and license and sell solution for indie content creators, i would bet they do it as an exclusive deal, and that content producers would rather go where the money is....
the baffling part is that if Google invested 25mm a year to license content, they could solve all of their problems and be the chosen destination for all indie content providers
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