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According to Eli the Computer Guy, it is something like: YouTube costs: $6.3 billion per year YouTube revenue: $4 billion So they are losing $2.3 billion per
by dottrap 9y ago
According to Eli the Computer Guy, it is something like:
YouTube costs: $6.3 billion per year
YouTube revenue: $4 billion
So they are losing $2.3 billion per year.
Eli the Computer Guy made a lot of waves around a year ago because his account was both incorrectly flagged for a "Community Strike" and his appeal was incorrectly dismissed which effectively left his channel dead in the water and he announced he was quitting. After outrage, a human finally stepped in and fixed the mess. Then later that year, his account was deleted by Google in the middle of a live stream without any explanation. (It was later restored, without explanation.)
Eli, talking as business entrepreneur, has talked a lot about the problems of YouTube as a platform. He frequently does business analysis and goes over numbers.
He has also broken down their cost structure, and yes, their expenses can really be that high. In addition to the massive number of videos that get uploaded every minute, they must also make multiple encodings of each one, and then all that needs to be mirrored to all the CDNs. (He was trying to figure out if he could do self-hosting...he felt if he just needed to make downloadable video files you watch offline, it can be done cheaply, but for streaming convenience, that's where things get expensive.)
Eli also quoted Susan Wojcicki stating that they still see YouTube as in the investment stage, which means they still are pumping money into it with no expectation that it's going to turn a profit anytime soon.
- criddell 9y ago$4 billion is the lowest estimate I've seen anywhere. Most analysts guess it's about twice that based on what they pay out in ad rev share. And yes - Wojcicki did say they are still investing in YouTube. Specifically she was talking about adding VR functionality. YouTube is probably profitable.
- dottrap 9y agoI've never seen anybody who's made a serious attempt to look at the numbers claim YouTube is profitable. All say the opposite. Some random examples: CBS Marketwatch: https://www.cbsnews.com/news/4-reasons-youtube-still-doesnt-make-a-profit/ https://www.cbsnews.com/news/4-reasons-youtube-still-doesnt-... Business Insider: http://www.businessinsider.com/youtube-still-doesnt-make-google-any-money-2015-2 http://www.businessinsider.com/youtube-still-doesnt-make-goo... Motley Fool: https://www.fool.com/investing/general/2015/03/01/youtube-isnt-profitable-so-what-should-google-inc.aspx https://www.fool.com/investing/general/2015/03/01/youtube-is... And none of these include this year's Adpocolypse.
- criddell 9y agoThose are all from 2015 where the weren't profitable. Look for something more recent. http://www.latimes.com/business/technology/la-fi-tn-google-youtube-20161027-story.html http://www.latimes.com/business/technology/la-fi-tn-google-y... http://fortune.com/2017/04/27/alphabet-earnings-up-as-ads-surge-on-youtube-and-mobile-devices/ http://fortune.com/2017/04/27/alphabet-earnings-up-as-ads-su... https://seekingalpha.com/article/4096345-google-youtubes-potential-exponential-growth-hidden-plain-sight https://seekingalpha.com/article/4096345-google-youtubes-pot... https://www.csmonitor.com/Business/2017/0129/How-YouTube-and-mobile-search-drove-revenue-for-Google-s-parent-company https://www.csmonitor.com/Business/2017/0129/How-YouTube-and... https://www.musicbusinessworldwide.com/youtube-will-earn-9bn-in-revenue-this-year-towering-over-spotify/ https://www.musicbusinessworldwide.com/youtube-will-earn-9bn... http://variety.com/2017/digital/news/google-youtube-alphabet-q1-2017-1202401702/ http://variety.com/2017/digital/news/google-youtube-alphabet... Even if YouTube isn't profitable today (and I think they are), the growth indicates they will be soon. > And none of these include this year's Adpocolypse. That's true. That could be interesting for sure. The Variety link talks about it a little bit.