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So, Uh, Don’t Copy The YouTube Business Model…
By Tim Gross - Internet Business Blog |
It currently costs Google $711 million a year to operate YouTube, and it only brings in $240 million in ad revenue… Which means it’s costing Google $471 million dollars this year to run YouTube.
Ouch.
So the good news is the number of user-generated videos that are uploaded to YouTube is increasing exponentially.
The bad news is that the more widely used YouTube becomes, the more Google will lose.
Why? Because the vast majority of user-uploaded videos are uninteresting, lame, useless, and not worth anything. For every YouTube video that is able to bring in ad revenue, there are almost an infinite number (and rapidly expanding) that don’t, and those costs will only increase.
It’ll be interesting to see what happens to YouTube in the future. Eyeballs aren’t enough; At some point you have to make money.
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